England’s rental market experienced an extraordinary event in July, as average rental costs exceeded £1,300 per property for the first time ever. This milestone, part of a record-breaking month for the Goodlord Rental Index, was accompanied by a sharp reduction in void periods, hitting an all-time low of just 9 days.
The Goodlord Rental Index, an analytical tool that scrutinises tens of thousands of completed tenancies monthly, pinpointed July’s average rental cost in England at £1,367 per property. A towering figure that not only represents a 19% rise from June’s £1,148 but also a 9.4% increase from the previous record of £1,249 set in September 2022.
Analysts have identified several contributing factors for this unparalleled price surge, including a traditional summer increase in student rentals during July, August, and September. The swift pace of student lets, along with rising interest rates and a shortage of available properties, have caused this intense upward thrust in rental prices.
The North West and South West regions experienced the most substantial growth, with rents ballooning by 48% and 45% respectively. Other areas, such as the East Midlands and the North East, saw significant hikes of 21% and 25%. Greater London, the South East, and the West Midlands recorded more moderate growth.
The dramatic spike in rental costs had a contrasting effect on void periods. In July, the average void period plummeted by 44% to a mere 9 days. Regions like the North East and the South West noted the steepest reductions, with void periods shrinking to 6 days on average, a respective decrease of 60% and 45% from June.
William Reeve, CEO of Goodlord, expressed astonishment at the July figures, saying, “This month’s numbers are quite staggering. In July we do usually expect to see an increase in rents and a reduction in voids – and all indicators pointed to a particularly red-hot summer for the rental market, if not the weather. So while the 10% year-on-year increase is a big shift, the sharp drop in void periods is also particularly surprising.”
Reeve further highlighted the influence of student rentals and suggested that the unprecedented trend may continue, stating, “Traditionally, rental costs continue to increase until September before cooling off in the autumn, which could mean these aren’t the last records we’ll see broken before the year is out.”
As the market approaches the autumn months, both renters and analysts will be keenly watching to see how these trends develop. The intersection of student accommodation demands, economic pressures, and property availability has created a rental landscape marked by record-breaking costs and minimal void periods, setting a tone that could continue to reverberate through the rest of the year.