The latest data and analysis from HomeLet has revealed rental prices across the UK have shown a modest rise in the first quarter of 2018. Overall, rents have risen by 0.9% in the last twelve months, equating to an average monthly increase of £3 per property.
Martin Totty, chief executive of HomeLet, had this to say: “Rental price inflation was much more stable over the whole of 2017 compared to 2016, when rents rose at an annual rate of more than 4% in the first half of the year, before dropping back in the second half. So far, we are seeing this more stable market continue to prevail in 2018.
According to the latest figures from HomeLet, average rents in the UK are now £912 - up by 0.9% on the same time last year. When London is excluded, the average rent in the UK is now £759, this is up by 0.1% on last year.
Rents in Scotland are showing the highest year-on-year increase at 5.6%. The region with the largest month-on-month decrease was the North East, showing a 2.1% difference between February and March 2018.
Martin continued: “The data also shows the sensitivity of the rental market to factors other than simply location. Last year, we saw rents in the areas surrounding the commuter belt to the south of the capital rise during a spate of rail strikes. The rate of growth has now slowed in this area as the strikes have ended. However, in the first quarter of 2018 rents in the central and eastern regions of London rose, which coincides with Crossrail nearing completion and suggests commutability into London has a real-time impact on the rental market.”
During the first quarter of 2018, house prices across the UK rose by 2.7%, whilst the rental market increases have been nowhere near as significant, rising just 0.3% (from £909 to £912), showing much more stability, which has characterised the rental sector over a long period. As well as this, overall rents have risen much slower over the last year than consumer price inflation, which was 2.5% in February.”
Martin concluded: “This data shows that a year into the three year phasing-in of changes to buy-to-let landlord taxation, rental inflation so far has remained steady rather than increasing as some commentators had predicted.”
Whilst March’s average increase reflects higher rents recorded in 10 of the 12 areas of the country HomeLet monitors – Wales and the North East bucking the trend - the pace of rental price inflation has slowed from 1.2% in February.