Average rents across the UK increased by 2.9% in January when compared with the same month last year, according to the latest data and analysis from Homelet.
The average rent across the UK now stands at £981 a month, the latest figures show.
Rental values between January 2020 and January 2021 increased in nine of the 12 regions monitored by the research, led by gains in the South West where rents are up 8% year-on-year.
Rents also increased significantly in East of England, the South East, East Midlands and West Midlands, with annual growth of 7.9%, 7.1%, 6.4% and 6% respectfully.
In addition, rents are up in Yorkshire & Humberside (4.5%), Wales (3.8%), Scotland (2.6%) and the North West (1.4%).
Rents remained unchanged in the North East, but fell in Northern Ireland by 2.1% year-on-year and in London by 3.6%.
According to the data, this is the eighth consecutive decrease in rental prices in the capital.
In fact, when London is excluded, the UK’s average rent is £839 per month, showing an increase of 5.8% on last year.
HomeLet CEO Andy Halstead said: “The data continues to show that demand remains exceptionally high in many areas. The needs of tenants have shifted throughout the pandemic, creating upward pressure on locations that offer more space, both inside and outside the property.
“Whilst rents are increasing; the expectation is that unemployment will increase further in the summer, undoubtedly leading to some tenants being unable to pay their rent. We’ve seen an exceptional demand for our rent protection products as agents look to safeguard their landlords and their management income.”
Rents rising is only one side of the equasion. Why they are rising is perhaps as important. Is this due to supply falling due to Government & Shelter’s interventions in the market or is it due to rising income providing greater affordability. My suspicion is landlords leaving the market which will increase even moreso once S21 is abolished by Boris Johnson.
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Will2
Anecdotal evidence that your suspicion is correct……..
When looking to buy a house recently 9 out of the 10 we enquired about were rentals with tenants in situ – some tenants had been given notice and some being sold with AST tenant in place. Those were just the ones we enquired about. There were more listed which had a flavour of being ex rentals and now empty.
From personal experience of advertising a rental recently demand is phenomenal with 15 applications in 7 days. Local Landlord friend had same level of interest. Where there used to be 6 to 8 houses being advertised now there is 0 to 1 at much higher price. Low supply + high demand = price rises.
Clearly these Govt interventions to allegedly help tenants are doing the opposite.
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Alex23. I offered a 2 bedroom maisonette for rent (Medway area Kent) early summer and it was on the market for just 10 days in which time I had 120 people applying & wishing to view! Initial sifting for viewing requests significantly reduced the number that could afford it (suitable for me to get RGI) to literally a handful. Most were on benefits had ccj’s, couldn’t prove income or had credit history problems (such as IVA’s) and I could not have obtained Rent Guarantee Insurance. It is simple no insurance or increased premium no letting. As I have to now pay referenceing fees I had to crudely sift applicants myself and decide if they were worth the gamble of paying referencing fees. At the time I was seriously considering selling whilst I had VP. Last time I had to evict a tenant the Council told the tenant to stay put until bailiffs came; contrary to Government guidance telling them if they left before the council would deem them as making themselves homeless. There was no bad feelings between my tenant and myself; their circumstances had changed and they simply could not afford the rent agreed 18 months earlier and fell in arrears which they could not recover from. Again this significantly increased my fees and losses. It is no surprise to me rents are increasing – so thank you Shelter, thank you Government for driving rents higher and driving up rental and landlord costs.
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Think you’ve identified the problem. There is plenty of rental demand. Trouble is that demand is of very low quality which most LL wouldn’t even consider. You are being very shrewd in insisting on RGI qualification. That reduces possible tenants to just a handful which just shows you the dross that most tenants are. With eviction nigh on impossible only an insane LL would risk tenants who don’t qualify for RGI. If they do that is a massive gamble which quite rightly you choose not to take. Like you I refuse to take on anyone without RGI. The impossibility of sourcing RGI qualifiable tenants makes BTL a defunct business model. It is precisely because I can’t source such tenants that I’m selling up. Once in 11 years I sourced a tenant who qualified for RGI and after I had to claim cost the RGI company £10000 Plus legal costs!!!! All for £89 annual premium. Perhaps with all the rent defaulting occurring more LL will behave sensibly like you! That will mean many LL having to sell up out of low quality areas to better ones where tenants can qualify for RGI. I foresee a collapse in BTL LL numbers. Great for cash rich LL who can afford to gamble on dross tenants. A luxury the BTL LL doesn’t have.
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Clear case of supply and demand. Over the last decade we have switched from a majority home ownership country. I recall a report last year said it was close to 50-50 split ownership to rental after the continued fall out from the boom and bust of 2008 and no sizeable social house building.
There is nothing to rent in my area except three meggar over priced properties. Anything that comes to market is gone without the need to advertise with 8% increase from 2019.
Main concern is tenants sustaining affordability. Some landlords raving about how high they are getting, may be in for a shock.
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