Property Reporter



1 in 5 pay over the asking price on new tenancies

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1 in 5 pay over the asking price on new tenancies

According to a new report from Countrywide, there has been a measurable fall in tenants' negotiating power when renting a new home.

The report found that 12% of lets were agreed at more than the initial asking price over the last year, with the average tenant paying 99.9%, the highest level since 2007. This figure is highest in London where the average let was agreed at 100.9% of the asking price.

One in five of those renting in London pay more than asked for to secure a home of their choice, far more than those outside of the Capital. This works out at an extra £94 a month over and above the asking rent against a UK average of £44 which, over the course of a typical 17 month tenancy, this equates to an extra £1,578 in rent for the average Londoner. At the other end of the scale just 1 in 12 tenants in Wales end up paying more than the asking rent, by an average of £24 a month.

London has seen the largest growth in rents anywhere in the country since 2007, with rents 34% above their pre-recession record compared to 12% across the UK as a whole. Despite these increases, the proportion of lets agreed at more than the asking price has risen in every year since 2008 demonstrating the continuing balance of power towards landlords. In 2008 just 3.5% of deals were agreed at above the asking price while 23.5% of tenants were able to negotiate money off the asking rent. By 2016 the proportion of tenants able to renegotiate prices down has plummeted to 8%.

The average UK rent rose 3.2% in the year to February 2016, two thirds of the rate in February 2015. As was the case in 2015, rents are growing at the fastest rate across the South of the UK. The South East (5.8%), South West (4.8%) and Greater London (4.2%) all recorded rental growth at above the UK average while the Midlands (1.1%) and the North (3.8%) both saw rents grow more slowly. The slowdown in top end, central London rents continued with the price of a new let falling 8.4% year on year.


Johnny Morris, Research Director at Countrywide, said: “The combined effect of growing numbers of people renting and a lack of supply has seen tenants’ ability to negotiate diminish. Tenants are having to compete more often and with more people in order to rent the home they want, meaning they need to offer more money in order to push ahead of the crowd.”

Proportion of lets made at above asking price

Average asking to achieved

Average amount paid above the monthly asking rent

London

19.9%

100.9%

£   94

South East

15.5%

100.1%

£   52

East

14.2%

99.9%

£   45

East Midlands

12.0%

99.8%

£   36

South West

11.8%

99.8%

£   38

Yorkshire & Humber

11.4%

99.8%

£   35

West Midlands

10.9%

99.7%

£   38

Scotland

10.3%

99.7%

£   28

North West

9.2%

99.7%

£   40

North East

9.1%

99.3%

£   35

Wales

7.8%

98.7%

£   24

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Latest Comments

HMO Midlands Landlady
HMO Midlands Landlady 24 May 2016

Tenants disappearing into the night is common from shared houses ( licensed and un-licensed HMO's) often when they owe considerable rent- they remove all their possessions, leave key in room and tell other...

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CommercialTrust
CommercialTrust 20 May 2016

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Johna
Johna 20 May 2016

"Easier said than done" is what I would say. Of course, it would be more than great to have more in quality and affordability, but I do not trust talk anymore.. What is said is not what is happening.

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Johna
Johna 20 May 2016

in my humble opinion being fair like THE most important! I myself have had bad experience with unfair landlords... not to mention that I know how to do a proper end of tenancy cleaning since I am a fantastic...

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richardrawlings
richardrawlings 18 May 2016

NB - even if we doubled our commission levels in the UK, we'd still be by far the cheapest agents in the entire world.

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Agent_PeeBee
Agent_PeeBee 18 May 2016

Clueless. Someone needs to take these people's computers away from them so they can do no more harm than they already have.

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richardrawlings
richardrawlings 18 May 2016

Nonsense! The cost of selling a house nowadays has little bearing on the fees charged. Don't believe your own spin on this. Fees have spiralled down to pathetic levels in areas where weak agents have allowed...

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Simon Oliver
Simon Oliver 16 May 2016

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WPD
WPD 12 May 2016

I suggest the answer is to have the notary system being one legal person who represents both parties. Having experienced it a couple of times in France it was a dream compared to our dysfunctional system....

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warren 03 May 2016

It's enough to make me weep into my Pimm's :(

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james anderson 03 May 2016

The sad demise of the croquet lawn...

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CommercialTrust 11 Apr 2016

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