London agent Kinleigh Folkard & Hayward says rents have increased by an average of 5% compared with the same time last year – with rents in some areas up by as much as 13%.
The average monthly rental price currently being achieved across the firm’s network of branches has soared above the £1,500 mark, at £1,538 compared with £1,476 this time last year.
Along with increased rental prices, tenancy lengths are also on the rise. The average length of tenancy at KFH has increased from 14 to 15 months.
James Thornett, regional lettings director at KFH, said: “The lettings market in London is experiencing huge amounts of growth as it becomes increasingly difficult for buyers to get on to the property ladder.
“We’re noticing rises particularly in areas that were once less popular, and this ‘overspill’ is becoming increasingly prevalent as the traditional core rental areas become too expensive for many tenants.
“As rents continue upwards it is no surprise to see tenants requesting long and longer tenancies, as they attempt to lock in to their properties for the maximum time on offer. In such a frugal economy, many are keen to minimise the costs associated with moving as well as tenancy administration costs.
“While this trend is an advantage to tenants, it is also gaining popularity among landlords who are keen to avoid costly vacant periods where their property could remain un-let.
“In quite a few cases, pre-agreed rent increases are also built into the tenancy agreement, to ensure that the rent keeps pace with the rising market and in line with the tenant’s budget.”