Rents fell in December but expected to climb again

Generali

Ok so LSL numbers.

LSL produce a house price survey which is probably the best overall index.

The 'yield' of 10.8% on here is, I think, actually average total gross returns/average house price. I think the reporting of this as 'yield' (income generated/current market price) is sloppy journalism rather than any Machiavellian use of terminology by LSL. Total gross returns would be rent + change in house price BTW so no inclusion of voids or upkeep.

The LSL rental index will only capture the BTL part of the market (presumably at least, I've found it very hard to find the methodology for this survey and my email back in November to them didn't get a response) so possibly this shows a divergence between private sector BTL rents (however those are determined) and other sorts of rentals such as social housing and tied accommodation.

The only problem I have with that is that the difference between BTL only and BTL plus other forms of rental is very big which means that other rents must be either not rising at all or falling in nominal terms. Given the squeeze that council budgets are under, I doubt that they are cutting rents and I think that an edict has come down from the Government instructing councils to increase rents to something closer to the market rate so that really leaves tied accommodation. Has something happened like the military no longer charging for housing or something?

Generally, numbers from the survey of household spending are likely to be pretty accurate because the survey is huge and done with a great deal of care and attention to detail. I'd always be inclined to go with them above any other survey unless I had good reason to do otherwise.

I'll see if there's a break down of the rent numbers somewhere.

IveSeenTheLight

Generali wrote: »

I'll see if there's a break down of the rent numbers somewhere.

This would be good as it's always good to understand the fundamentals of the stats.
I tried a quick search but didn't get any real good details and don't have the same time nowadays

Generali

IveSeenTheLight wrote: »

This would be good as it's always good to understand the fundamentals of the stats.
I tried a quick search but didn't get any real good details and don't have the same time nowadays

The trouble is, the breakdown of the survey is averaged across the whole survey so spending on housing includes an amount for rent, mortgage, moving, EA fees etc. There is no break down across different types of rent.

IveSeenTheLight

Generali wrote: »

The trouble is, the breakdown of the survey is averaged across the whole survey so spending on housing includes an amount for rent, mortgage, moving, EA fees etc. There is no break down across different types of rent.

Am I right in thinking then, you canot use these LSL figures to compare rents against wages as they include other factors.