Rents Hit Records As Property Shortage Deepens

Tenants are having to find an average of almost £600 a year more to rent a property in the UK.

According to the latest report on the sector by the agents Reeds Rains and Your Move, tenants were having to fork out a record £816 on average across England and Wales last month.

It (Other OTC: ITGL - news) measured new regional price records for London, the South East, the South West and the Midlands - with people in the capital now typically having to fork out more than £1,300 per month, a rise of 11.6% on the same period in 2014.

While the price rises for September can be partly blamed on traditional factors such as demand from students, the survey cited weaker availability as a core reason for rents increasing by more than 10% in real terms since 2010.

Adrian Gill, director of Your Move and Reeds Rains, said: "Rents are rising strongly in real terms due to the recent acceleration in wages and the much deeper and longer-term shortage of available properties across the UK.

"The cost of a place to live has now uncoupled from the cost of living."

The lack of homes is also the driving force behind rising house prices as demand outstrips supply.

While the Government has announced plans to relax planning laws and support more first-time buyers, construction firms are being hampered by a lack of skilled labour.

Surveyors recently reported rising sales , as a result of greater availability of mortgage finance, had helped keep a lid on price rises last month but warned the shortage of properties on the market would continue to prop costs up.

New (KOSDAQ: 160550.KQ - news) instructions were falling, they said, because of worries about affordability and the economy.