The pace of UK rental growth has more than halved in the first 12 months since the extra Stamp Duty charges were introduced, new research suggests.
Data from buy-to-let investing platform Landbay shows annual UK rental growth slowed to 0.90% in March 2017 to £1,191, less than half of the rate of 2.27% seen at the end of March 2016.
If London was taken out of the equation, the average rent in the UK would be £752, while tenants face paying £1,880 in the capital.
The speed at which rents are growing on a monthly basis also slowed to 0.11% in March, the slowest monthly rate on Landbay’s Rental Index since February 2013.
Average rents in the London boroughs of Kensington & Chelsea, Westminster and Camden saw the most significant fall in rents over the last twelve months, falling by 3.65%, 2.64% and 1.49% respectively. In contrast, rents within the boroughs of Barking and Dagenham, Havering and Bexley have grown by 2.72%, 2.70% and 2.25%, according to the index.
Paul Brett, managing director of intermediaries at Landbay said: “The past 12 months have been tough for the private rented sector, a period marked by the Stamp Duty surcharge last April, followed by changes to mortgage interest tax relief, tighter underwriting criteria and the pending ban on letting agent fees.
“While the figures suggest that the Government has had some success in its efforts to rebalance, policy makers should be wary of imposing any further regulation. The private rented sector is a crucial part of the housing mix and needs to be supported by landlords, tenants, housebuilders, lenders and the Government alike.
“Playing the blame game will simply deter further investment and set the housing market off course for good. What is now needed are positive measures aimed at encouraging the development of high quality rented properties, a step change outlined in the recent Housing White Paper.”