Tenants 'see smaller rent rises'

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Millions of private tenants across the UK are experiencing smaller rent rises than normal, according to two separate surveys.

LSL Property Services, which owns two chains of estate agents, says average rents in England and Wales rose by just 1.8% over the past year.

That is well below the Consumer Prices Index (CPI) inflation rate of 2.8%.

Separately, property company Move With Us says that six areas of the UK have seen rents fall in the past month.

Demand 'softened'

LSL believes that price rises are being moderated by more flats and houses becoming available for rent, as a result of more buy-to-let landlords purchasing property.

The company also believes that many people who previously rented are now trying to buy, reducing the demand for rentals.

"The supply of rental accommodation is increasing, while demand has softened slightly because of the improvement in first-time buyer numbers," said David Newnes of LSL.

As a result, it says the average rent in England and Wales is now £738 a month, compared with a peak of £744 a month in October 2012.

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'Win-win'

According to Move With Us, rents fell between June and July in the East Midlands, Greater London, north-east England, Scotland, the South West and Yorkshire and Humber.

Overall it says that rents across Britain as a whole fell by 0.32% over the last year.

But the two surveys have also come up with different results.

Move With Us suggests that rents in London fell by 5.7% over the past 12 months, while LSL says they actually rose, by exactly the same amount.

In any case, any relief for tenants may be short-lived.

"In the medium term we expect rents to at least keep up with wider inflation," said David Newnes.

"It's unlikely July will be typical after the initial change of pace in the purchase market, but a few months of more affordable rents are a win-win for everyone," he said.

Recently published figures from the Office for National Statistics suggested rent rises in the last year were indeed below the rate of inflation.

In June, it said rents rose annually by 1.5% in Wales, 1.3% in England, and 1% in Scotland.

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