Private rents have risen for the fifth month in a row to reach a new record high, according to LSL Property Services. The average monthly rent increased by 2.9 per cent year-on-year in August, reaching £734.
With prospective property buyers still finding mortgage finance difficult to obtain, many demand for rental property remains high, prompting landlords to raise rents. However, higher rents makes it more difficult for first-time buyers to save up for their deposit.
David Newnes, director of LSL Property Services, said: “The rental market is right in the thick of its peak season and the demand from graduates and those starting new jobs has added a new layer of competition on top of the existing pool of frustrated buyers.”
Mr Newnes expressed hope that the Funding for Lending scheme will help people take their first step on the property ladder, but added that conditions for first-time buyers will have to ease significantly before any impact is made on the rental market.