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Landlords see rise in annual returns
19th December 2011
Buy-to-let owners could be increasingly keen to protect their finances by taking out landlord buildings insurance as their properties become ever more valuable assets.
According to new figures from LSL Property Services, despite a seasonal fall in average rents this November, total annual returns for landlords have increased to 2.2 per cent over the past 12 months, up from 1.4 per cent in October, helped by a slowdown in the fall of property prices.
The company's figures show that the average rent in England and Wales fell by 0.4 per cent to £717 per month in November, the first monthly decline since January.
However, this drop was down to seasonal factors, said LSL, and average rents are still up 3.5 per cent annually.
"Following their relentless march upward throughout the year, rent rises have taken a pause for breath," said David Newnes, director of LSL Property Services.
"Landlords are looking to avoid having properties vacant over the Christmas period, and can be less aggressive with pricing as tenant activity slows in the run up to the New Year.
"But across the country, the limited supply of rental accommodation means there will still be strong upward pressure on rents in the early part of 2012."
Over the past 12 months, rents have risen in all regions of England and Wales, with the fastest increases coming in London and the South East, where average rents are up 4.2 per cent.
Meanwhile, the slight fall in rents in November has in fact come with one benefit for landlords in that tenant finances are looking healthier.
LSL found that unpaid rent at the end of November stood at a total of £263 million, and eight per cent drop from the £287 million that went unpaid in the previous month.
Posted by Heather Thomas