Rents rose for the fourth quarter running for each type of property, including detached, semi-detached and terraced houses and flats according to the Association of Residential Letting Agents (ARLA).

The quarterly survey says that as a result, void periods have fallen to an average of 24 days. Over two thirds of all agents in Prime Central London report rising rent levels, as do half of the agents in the rest of the South East. The proportion of agents reporting rises in the rest of the country rose from 33% to 35%.

Seven out of ten Prime Central London agents say there are more tenants than properties. This is the highest figure seen since the ARLA surveys started 6 years ago. In the South East, 10% more agents report demand is outstripping supply.

Meanwhile, the average capital asset values of rented houses rose during the past three months by 2.2% in Prime Central London and 0.3% in the South East. By contrast, they fell by 3.9% in the rest of the UK. Average rented house values ranged from £885,000 in Prime Central London to £229,900 away from London and the South East.
Rented flats did less well, with the average asset value across the country down by 1.3% for the three month period. Asset values for flats ranged from £501,000 in Prime Central London to £210,000 in the South East and just £153,000 in the rest of the country. However, flats showed a slightly higher gross return.

Despite the rising rent levels, the average weighted returns are down marginally from 5% to 4.8% for houses and from 5.1% to 5% for flats. ARLA believes this to be a reflection of continually rising house prices during the quarter.