Member Article

Rents fall in North East

The North East is the only area in the country where residential rents have fallen according to the latest figures released by property services group LSL.

The statistics reveal that in 2012 rents across England and Wales rose by 4.3 percent on average but the North East was the only area where rents fell – at a rate of 0.7 percent.

The average rent in the region costs £512 – 39 percent lower than the average of £712 across England and Wales.

Ajay Jagota, managing director of North East-based KIS Lettings, believes one of the key factors causing the region to differ from other areas is the high levels of unemployment.

Ajay explained: “It’s no coincidence that the North East, the area with the highest rate of unemployment in the UK, also has the lowest rental rates and is the only place to see an annual drop in the average rent.

“Supply and demand is operating differently in the region than other areas of the country and that is causing the low rents.

“We live in an area that has relied heavily on public sector jobs and with those jobs going, in addition to many private sector job losses, there’s a knock-on effect in the housing market.

“Fewer first-time renters can make the move and fly the nest and others may opt to move away from the area to find employment, which is lowering the demand for rental homes. Meanwhile, more property owners are being forced to let their homes, creating an increase in the supply of residential property lets available.

He added: “Until unemployment levels start to reduce, landlords may have to work smarter to let their property and compete for tenants.

“What is key to letting a property in an area that might not be booming quite as much as elsewhere in the country, is to bring residential lets to market in the best possible condition.

“In order to attract tenants, landlords may need to carry out improvements and make small investments that will pay off very quickly.”

Next week Ajay will be posting his top tips to successfully let a residential property.

This was posted in Bdaily's Members' News section by Ajay Jagota .