Tenants lock in long rents, hunt ‘all bills included’ deals

Homes and strong demand for the properties available has led to a greater number of tenants choosing to renew their leases and stay put, rather than re-enter a competitive rental market, according to new research[1].

People who had been waiting to see what happened last year are now being faced with record rents and so are seeking out properties where they can have more certainty over their outgoings, with all bills included becoming increasingly sought after. The research reveals the changing behaviours of tenants against the backdrop of record rents and increasing household bills.

LENGTH OF TENANCY

A study found that the most common length of tenancy is over two years, with 18% of landlords saying their average length of tenancy has increased over the past year.

Only 5% of landlords have seen the average tenancy length decrease. The data shows that national asking rents outside London are rising at the fastest rate ever recorded, now standing at £1,088 per calendar month (pcm), up 11% on this time last year. It is a similar story in the capital where rents are up over 14% to £2,195 pcm.

RENTAL HOMES

There are also more than triple the number of tenants enquiring as there are rental homes available, making it the most competitive ever rental market. The lack of available properties is a combination of more tenants staying put in longer tenancies, coupled with high demand from people who didn’t move during the pandemic, or who moved in with friends or family temporarily.

Many landlords have recognised the challenges of rising household bills for tenants, with the majority (63%) choosing not to put up rents over the past year, while a third have increased rents.

INCREASED DEMAND

Some agents in bigger cities report that tenants who were able to move into a property for much lower than the average rent for an area during the pandemic have seen rents increase back up to market value again now that demand has increased.

The analysis has revealed a significant increase in demand for properties with all bills included. Over the past year enquiries from tenants have jumped by 36% for this type of property, the biggest increase out of all available features.

AFFORDABILITY CHALLENGES

Homes with balconies, communal gardens, properties allowing pets and those offering zero deposits all came equal second, with enquiries jumping by 22%.

Some landlords may have been tempted to put their rents up given the high demand from new tenants, but many understand the affordability challenges of rising rents and bills, as the study shows that the majority are charging their tenants the same as a year ago.

Don’t forget, our professional friendly advisers are on hand to support you and can help you explore all of your options. 

Source data:
[1] https://www.rightmove.co.uk/press-centre/tenants-lock-in-longertenancies-and-more-seek-all-billsincluded/