Buy To Let Updated:
Rents fell in February as an increased number of tenants considered moving into the sales market to beat the stamp duty holiday deadline.
The price of renting in the UK has been on a seemingly unstoppable ascent in the last 12 months as more people have turned to the market, with buying a home beyond the reach of many.
However, with first time buyers able to sidestep the 1% tax on properties worth between £125,000 and £250,000 until 24 March, many have used it as their cue to take their first step on the property ladder.
This caused rental prices to fall in February, LSL Property Services says.
The average rent in England and Wales fell by 0.6% to £707 per month, following a rise in January.
While the figures on their own may come as a worry to landlords, the longer term trend remains one of growth, with rents rising by 3.5%, representing a £24 rise in the past year.
In the last 12 months the largest increases in rents have been in London, where rents rose by 5.6%, and the East of England, where rents increased by 5%. On an annual basis, rents have only fallen in one location, dropping by just 0.2% in the East Midlands.
"The looming spectre of the end of the stamp duty holiday has taken its toll on tenant competition in the run-up to the deadline, easing the upwards pressure on rents," said David Brown of LSL Property Services.
"In February, an increased number of tenants either became owner occupiers, or seriously considered property purchase, rather than renewing their contract or seeking a different rental property.
" With fewer tenants than usual actively competing for properties, combined with a slight improvement in the number of rental properties becoming available, many landlords priced less aggressively to avoid the prospect of a void period."
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