Buy To Let Updated:
The cost of renting a home in England and Wales dropped by 0.3% during January as the mortgage market showed improved levels of activity, according to latest research by LSL Property Services.
The average monthly rental repayment stood at £732 last month, the lowest level seen since July 2012, with the South-East of England experiencing the biggest drop in rental costs.
Increased activity in the mortgage market, as a result of the Government's £80 billion Funding for Lending Scheme, is believed to be a contributing factor towards the drop in rental costs. A number of lenders have launched competitive mortgage deals and reduced their rates over recent weeks, providing some relief to frustrated borrowers. David Newnes, director at LSL, said: "An improving mortgage market in January helped take a little pressure off the limited supply of rental property, at a time when the demand from tenants on the move is far from its seasonal peaks."
Despite the slight fall, average rents were found to be 2.8% higher compared with January 2012, highlighting the fact that demand for rental accommodation is still high amongst would-be buyers.
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