HomeLet and Let Alliance’s chief executive Andy Halstead has called for less “government grandstanding” and more direct action to recognise the crisis in the private rental sector. 

He says rental income should be recognised as business income in a bid to ease the mounting pressure on all parties within the sector. His words come in the wake of the latest HomeLet Rental Index, which reveals that the average UK rent has increased by a further +0.9% compared to February.

Halstead saus: “Rent remains high, demand is strong, and supply remains limited. These indicators do not look like moving significantly for the foreseeable future. 

“Professional letting agents have the dual challenge of delivering acceptable yields to their landlord customers and delivering sustainable profits for their businesses. Continued government grandstanding and indecision are making life difficult for all stakeholders in the private rental sector.

“Until landlords’ rental income is recognised as business income rather than earned income for tax purposes, the stress on individual private landlords and their tenants is likely to continue. It has never been more important for landlords to benefit from the services of professional letting agents, who take the steps to mitigate the risks that individuals face when renting an investment property.”

For March, the HomeLet data reveals that UK rents rose by a further 0.9% on average compared to the previous month, meaning tenants are now paying £11 more each month compared to February.

The North East and Yorkshire and the Humber witnessed the biggest month-on-month increases at 2.1% and 2.0% respectively. That equates to an extra £14 pcm and £17 pcm. With average monthly rental prices reaching £2,102 in Greater London, even a more modest increase of 1.5% amounts to an extra £32 pcm.

Halstead adds: “Although some areas of the UK have witnessed a marginal decrease in rental prices since February, the vast majority of regions have experienced yet another price increase in the space of a month.

“That means that, on average, tenants are paying an extra £11 a month compared to February alone. That might not sound like much but when you consider that rental prices are now 7.52% higher than they were in March 2023, every subsequent monthly increase puts added pressure on tenants’ budgets. There is a very simple solution to this situation and that is to ensure landlords are taxed fairly.”

Further findings from the HomeLet Rental Index indicate that UK average rent is up 7.52% year—on-year, with Wales and the East Midlands the only regions to enjoy rent decreases this month, with figures falling by 0.4 and 0.1% respectively.

The highest annual rent variance was in the West Midlands, with rental prices now 9.02% higher annually. The lowest annual variance was recorded in Wales, with tenants paying 4.84% more than in March 2023.