Two things turned up in the lettings data this month that look contradictory and aren't. Landlords are raising advertised rents now that offers above the asking rent can't be accepted. And void periods are getting shorter.
They are two sides of the same behaviour.
Price discovery has to happen somewhere in the process. Take away the ability to discover it after listing and it doesn't disappear, it moves forward to before listing. The number gets fixed earlier, with less information behind it, and properties split into two groups. The ones priced right move quickly. The ones priced wrong sit. Average voids falling and individual properties sticking for months are perfectly compatible.
On the sales side this can be measured precisely, because both prices leave a trace. Across the listings we track, the national median asking price in June was £320,000 against a median achieved price of £295,000, a gap of 7.8%. For flats the gap is far wider: £240,000 advertised against £200,000 achieved, 16.7%.
So even in a market where asking and achieved prices are both public and constantly compared, the advertised figure sits close to a tenth above what actually gets paid, and the harder the stock is to shift, the further out it sits.
Lettings is heading to the same place under worse conditions, because advertised rents are no longer tested by competing offers. They are purely an opening position now. Price a landlord's property off portal asking rents and you are pricing off somebody else's opening position, and that error compounds the longer it runs unchecked.
Achieved rents on comparable stock, and how long that stock took to let, are the two numbers that still mean something. They are harder to get hold of, which is exactly why they are worth having.
Co-founder of Propalt and a property investor and developer for 20 years
