Pace of rent rises slows to below the rate of inflation

Rents on new tenancies look likely to have risen at slower rate than inflation for each month of 2017, HomeLet claims.

The tenant referencing firms latest December Rental Index found prices on newly agreed tenancies rose 1.7% during the last month of 2017 to £907.

This compares with £892 from the end of 2016 when rents were up by more than 4% throughout the year.

The data for December 2017 also means it is likely that rents rose at a slower rate than general inflation in every month of last year, with the consumer price index measure running at 3.1% based on the most recent available figures from November 2017.

The south east of England was the only region to register a fall in rents last month, with average rents in December down 1% on 2016 to £989 per month.

It means new rents in the south east fell on an annualised basis in every month of 2017.

The east midlands saw the highest rate of rental inflation in December, with rents up 4.6% annually to £611.

Martin Totty, chief executive of HomeLet, said: “2017 was a year in which rental price inflation was modest; we actually saw average rents across the country fall during May and June, and while this was not repeated during the second half of the year, we remain some way off the much higher levels of rental price inflation that prevailed in 2015 and much of 2016.

“We continue to see a very mixed picture regionally: in areas of the country where rents rose less quickly in 2015 and 2016, rental price inflation was much higher last year; by contrast, those areas where rents were previously rising fastest have been seeing much more modest increases.”

Region

Average rent in December 2017

Average rent in November 2017

Average rent in December 2016

Monthly variation

Annual variation

East midlands

£611

£615

£584

-0.7%

4.6%

South west

£811

£802

£785

1.1%

3.3%

North east

£545

£533

£528

2.3%

3.2 %

Northern Ireland

£620

£621

£601

-0.2%

3.2 %

North west

£686

£685

£670

0.1%

2.4%

Scotland

£614

£620

£603

-1.0%

1.8%

Yorkshire & Humberside

£624

£624

£612

0.0%

2.0%

West midlands

£675

£675

£662

0.0%

2.0%

East Of England

£908

£894

£895

1.6%

1.5%

Greater London

£1,524

£1,530

£1,509

-0.4%

1.0%

Wales

£605

£610

£605

-0.8%

0.0%

South east

£989

£976

£999

1.3%

-1.0%

UK

£907

£904

£892

0.3%

1.7%

UK excluding Greater London

£758

£753

£745

0.7%

1.9%

Notes:

Based on new tenancies in December 2017

Based on new tenancies in November 2017

Based on new tenancies in December 2016

Comparison of average rent in December 2017 and November 2017

Comparison of average rent in December 2017 and December 2016

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