The dramatic rise in house prices over the past year has been well documented and debated, but left somewhat in the shadows in the world of renting. New data shows that the average UK rent is now approaching £1,000 a month.
After 5 months of continued growth, April’s average UK monthly rent was £996, the highest it has ever been and marking an annual increase of 2.9%.
The data from HomeLet shows that the South West has seen the most growth with rents up by 8.6% on the year, meaning the average rent in the region is now £955 a month. The East Midlands is next with an 8.1% annual rise bringing rent to £709.
London, however, is struggling after enduring 11 consecutive months of declining rent values and is the only UK region now to see growth. Today, average rent is £1,580, 5.3% lower than it was a year ago.
HomeLet and Let Alliance Chief Executive, Andy Halstead, said:
“We’re continuing to see a sustained demand for let property; against a backdrop of reduced stock, with landlords facing increased costs and growing concerns about legislative changes.
“As we gradually ease from protective measures, the stark reality is that we’re fast approaching a summer where rental prices could accelerate at a rate never seen before.
“Almost a quarter of adults in the UK live in the private rented sector.
“We all agree that the industry works best when balancing the needs of all parties, critically between landlords and tenants.
“The common misconception is that increases in rents are solely driven by unscrupulous landlords trying to maximise profits.
“That is simply not true.
“Landlords have been hit by a sustained raft of legislative changes, which mean that their costs to let property have had to increase.
“With the Tenant Fees Act as an example, costs are ultimately passed on to tenants through higher rents – the same group who should have benefited most from that legislation.
“The ban on all tenant evictions [during the pandemic] and plans to abolish Section 21 may prompt some landlords to consider exiting the market when they’re able to, causing yet more strain on property supply.
“Letting property will continue to be an excellent long-term investment, but the pandemic has amplified some of the issues that both landlords and tenants are facing.
“The reality is that once the furlough scheme ends, millions of people could potentially be facing unemployment at the same time as tackling the most expensive rental market on record.
“The country risks a deepening crisis if policy change aimed at restoring balance to the market is not urgently pursued.”