Newly let home rents up 3.1%

Newly let home rents up 3.1%

According to the latest analysis from Countrywide plc, rents for newly let homes continued to grow in 2015 albeit at a slower pace than in 2014. Average rents grew by 3.1% over the year, taking the average monthly rent to £919pcm.

Rents rose in all regions of the country with the East of England seeing the highest growth, up 6.5%, and the Central London market seeing the lowest with a 0.5% growth.

34% of tenants who renewed their tenancy faced higher rents, an increase of 7% from last year. However, the average rent for renewing tenancies only grew by 1.3%, less than for those moving into a new home.

Rental growth over 2015 was supported by increasing demand for rental homes and low stock of homes available to rent. This imbalance between supply and demand has intensified competition for homes in the market. The average property is now let within 20 days of being instructed; two days quicker than it was in 2014. The time to let has fallen across the country, but homes in the North of England and the Midlands are now let almost three days quicker.

Greater London as a whole saw a slowdown in rental growth in 2015 compared with 2014, but rents still rose by 4.7%. As rents have risen in recent years, tenants have increasingly looked to cheaper areas in Outer London.  As a result the proportion of under 25s living in the rental sector in London fell by 4% in 2015, the continuation of a longer term trend. As rents continue to increase and outpace earnings in the capital, younger people and those in lower income brackets, have found it harder to remain in the capital, particularly in central areas. Surrounding regions in the South of England have seen small growth in the proportion of under 25s in their market, as Londoners look further afield for more affordable markets.

Table A: Average rent for newly let units

Region

Average rent in Q4 2015

Average rent in Q4 2014

Year-on-year increase in rent

Greater London

£1,292

£1,234

4.7%

Central London

£2,497

£2,485

0.5%

East of England

£945

£887

6.5%

South East

£1,139

£1,118

1.9%

South West

£816

£784

4.1%

Midlands

£663

£651

1.8%

North

£636

£627

1.4%

Scotland

£662

£637

3.9%

Wales

£666

£648

2.8%

Total

£919

£891

3.1%


Johnny Morris, Research Director at Countrywide, said: “A mix of steadily increasing demand and a lack of homes to rent supported rental growth in 2015, even though wage growth remained subdued.  In the capital rising costs meant renters were more likely to move to Outer London or the commuter belt in search of more affordable places to live.
 
2016 looks to be a complicated year for landlords as the government focuses its efforts on boosting homeownership. The additional 3% stamp duty charge, stricter regulation and changes to tax relief from 2017 onwards will all take their toll on investor sentiment and impact behaviour.

With stock at a premium, the smaller landlords who decide to sell up will add upward pressure to rents, although any rises will be tempered by affordability pressures.”

Average rent for occupied units

Region

Average rent December 2015

Average rent November 2014

Average rent December 2014

Year-on-Year Increase in rent

Month-on-Month Increase in rent

Greater London

£1,196

£1,192

£1,132

5.7%

0.3%

Central London

£2,449

£2,445

£2,435

0.6%

0.2%

East of England

£862

£859

£829

4.0%

0.3%

South East

£997

£995

£981

1.6%

0.2%

South West

£737

£736

£724

1.8%

0.1%

Midlands

£629

£629

£620

1.5%

0.0%

North

£624

£623

£612

2.0%

0.2%

Scotland

£641

£639

£624

2.7%

0.3%

Wales

£650

£649

£636

2.2%

0.2%

Total

£857

£856

£834

2.8%

0.1%

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Latest Comments

Spencer Fortag
Spencer Fortag 25 Aug 2016

The funny thing is, I mentioned the brick issue in my blog back in April: http://medwayproperty.blogspot.co.uk/2016/04/the-medway-property-market-and-lack-of.html

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SecomTech
SecomTech 19 Aug 2016

Firstly, I either lodge with DPS or do not take a deposit...secondly, If a tenant has not received a confirmation their deposit is secured with either a scheme or in an insured account with an agent/landlord,...

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jasonevans
jasonevans 19 Aug 2016

Belvoir has over 15 years of experience in property lettings, buying and renting and is one of the best agencies I know about. I have heard that they revived an award for the hard work. Really amazing...

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jasonevans
jasonevans 19 Aug 2016

Usually these areas are least affected when it comes to unexpected economical collapse.

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TheWaspNestRemover
TheWaspNestRemover 11 Aug 2016

You agree to pay for the treatment needed to get rid of fleas, ants, mice, wasps nests and other pests unless you can prove that these are a result of us not meeting our repairing responsibilities or these...

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madisonwelch80
madisonwelch80 02 Aug 2016

16% is quite a raise. Let's hope this tendency won't continue for long.

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madisonwelch80
madisonwelch80 02 Aug 2016

?66,963 is a serious price drop However buying a property it a serious investment only small percentage of the UK population could afford.

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madisonwelch80
madisonwelch80 02 Aug 2016

Wow, it kind of surprised me. I mean counting on mom and dad's bank even after retirement is too much. That's the moment in life when one should have ensured themselves. I am shocked.

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AbbieP.
AbbieP. 22 Jul 2016

"While house prices in the most expensive eleven boroughs have declined values in the cheapest eleven boroughs continue to rise" - not a nice way to even out the price range. London is overrated as it

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AbbieP.
AbbieP. 21 Jul 2016

And try to profit from your decisions, I may add

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CommercialTrust
CommercialTrust 19 Jul 2016

Retirement investment has always been one of the biggest draws of buy to let. And the buy-to-let demographic is, on balance, older. (Over a third of our applicants are over 50 at the time of application.) It...

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Forrest Wheatey
Forrest Wheatey 11 Jul 2016

I find the time perfect for ever home-owner wannabe. Prices should slowly, but steadily drop, at least for the inner buyer. Making it harder for outsiders to buy properties (the whole Brexit thing means...

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