Average rental prices in the UK have increased by 1.5 per cent to £921 per month in the 12 months to December 2018, according to the recent data from HomeLet’s Rental Index.
Most of this has been led by a steady rise in London where rents increased by 4.7 per cent to £1,596. Outside of the capital, the rise was just 0.7 per cent, however, averaging £763, according to the HomeLet index.
Figures also show that the private rented market is resilient and in December rents increased by 75 per cent of the regions covered in the survey. But rents were down by 0.3 per cent month on month according to the recent Index Report.
The biggest year on year rise was 4.7 per cent in London and the largest fall was 4.6 per cent in the North East of England, falling to an average of £520. This is a slight increase of 0.6 per cent month on month.
In Scotland rents increased 1.5 per cent year on year to an average of £623 but fell by 1.9 per cent month on month. Meanwhile, in Wales, rents fell by 1.7 per cent year on year to £595, which was a 0.7 per cent fall month on month. In Northern Ireland, rents rose 1.9 per cent year on year to £632, which is down 1.1 per cent month on month.
Rental growth in the Midlands has steadily increased 2.1 per cent year on year and 0.1 per cent month on month in the West Midlands to an average of £689. Similarly, rents in the East Midlands have risen 2.9 per cent year on year and by 0.6 per cent month on month to £629. In the East of England however, rents fell by 0.3 per cent on an annual basis to £895, which is down 1.4 per cent monthly, according to HomeLet’s Rental Index.
The South West of England saw a steady increase in rents in 2018, which were up 2.7 per cent and 1.7 per cent month on month to £833, showing clear signs of resilience. The North West of England also saw a notable increase, with rents increasing by 1.7 per cent year on year, and by 0.6 per cent month on month to £698. In the South East, however, rents increased less dramatically by 0.9 per cent year on year and by 0.9 per cent month on month to £998, according to HomeLet.
However, there was no increase of rents in Yorkshire and Humberside year on year to December, with a minor increase of 0.2 per cent month on month to £624.
Martin Totty, chief executive of HomeLet commented: “Positively for both tenants and landlords, this year we’ve seen stability in UK rental price growth, with increases remaining broadly in line with the rate of consumer inflation.
“For landlords, there remains a sustained demand for property, with the private rental sector continuing to provide the market with both flexible and long term housing options.
“Private residential landlords will continue to play a key role in the wider UK housing market. Whilst the outlook for property investors remains positive, one of the key concerns for the market in 2019 would be a potential lack of supply in certain regions.”
“The Government’s squeeze on private landlords via taxation changes and more regulation could discourage their continued participation in this important sector. Unlike the trends we saw in 2018, any reduction in supply could lead to rental increases that are above the rate of consumer inflation,” Martin Totty added.