Tenants renewing an present contract within the UK noticed their hire rise by a median of 8.3% over the past 12 months, outpacing rental development on a newly let property (6.4%).
This is in response to the most recent Hamptons Monthly Lettings Index for April, which reveals that 88% of tenants renewing an present contract up to now in 2024 noticed their hire enhance. This compares to 61% of landlords who achieved the next hire when a brand new tenant moved in.
However, tenants who keep put and renew their contract are nonetheless paying 13.4% or £178 pcm much less on common than somebody who has moved into a brand new house. This is lowering the motivation for folks to maneuver, Hamptons mentioned.
The annual tempo of rental development on newly let properties continued to gradual in April, nonetheless rents edged up 0.8% month on month. This marked the most important month-to-month enhance this yr, suggesting that the tempo of annual rental development could settle round this stage.
Commenting on the most recent figures Hamptons head of analysis Aneisha Beveridge mentioned:
“Many tenants had loved years of no or below-inflation hire will increase, significantly when rents weren’t rising a lot on the open market and mortgage prices have been falling. Landlords have been typically content material with a small hole between the market price for his or her house and what their tenant was paying. However, over the past two years, sturdy rental development on the open market has meant that the hole between market charges and what some tenants have been paying rose considerably.
“Tenants lucky sufficient to be protected against larger rents by their landlord or longer contracts are more and more seeing their rents rise. These will increase for renewing tenants are typically decrease and stretched over an extended interval than for newly let properties, typically that means tenants nonetheless pay beneath market price. But even so, these hikes can nonetheless add as much as a whole lot of kilos a month.
Beveridge added that the big hole between market charges and what many tenants are paying was a giant disincentive for them to maneuver except they should. “Moving more and more means getting much less house for more cash. While time will finally shut the hole between what sitting and new tenants are paying, it might take longer if rental development on the open market begins selecting up once more.”
