UK property rents rise at fastest ever rate
Rents outside of London have jumped almost 10% in a year and are now averaging £1,068 per month outside of London while the capital hit a new record of £2,142 per calendar month (pcm), new figures show.
Rents have been rising at their highest level in 13 years as the number of tenants looking for homes has outstripped the number of properties available.
Data from property company Rightmove (RMV.L), based on more than 300,000 properties, found the average rental price being asked rose 9.9% to reach £1,068 pcm outside of London, the highest annual jump on record.
Rising rents are outpacing house price increases in all but three regions — East Midlands, South West and South East.
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Wales led the way in annual asking rent growth, rising 12.7%), followed by the North West, up 12.5% and the South West, up 11%.
Pontypool in Monmouthshire, Wales saw the largest annual increase in asking rent of any local area, jumping 20% from £562 pcm to £674 pcm, followed by Ascot, where rents rose 18.8%, and Littlehampton, up 17.5%.
Demand from renters in the capital was reduced early in 2021, as some decided to move away due to working from home or wanting more space during coronavirus lockdowns. But by the end of 2021, London rents are higher than before the pandemic started, as its popularity returned and landlords were able to negotiate higher rents for the new year.
At a record £2,142 pcm, London saw the largest quarterly jump of any region, rising 6.1%. Rents in the capital are now 3% higher than the beginning of 2020.
Inner London rents also grew at a record 16.2%, recovering from a drop of 14% at the beginning of 2021.
Rightmove predicts asking rents will rise by 5% in 2022 as imbalance between supply and demand continues.
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“Tenant demand continues to be really high entering the new year, meaning the imbalance between supply and demand is set to continue until more choice comes onto the market for tenants, which has led to our prediction of a further 5% increase in average asking rents in 2022,” Tim Bannister, Rightmove’s director of property data, said.
“Landlords understand the importance of having a good, long-term tenant, and there is a limit to what renters can afford to pay, which will prevent rents rising at the same rate we’ve seen over the past year.”
Total rental demand is up by one third compared to this time last year, while the number of available rental properties dropped by half.
Flats have seen the highest increase in competition compared to last year, jumping 132%, followed by terraced houses, up 40% and semi-detached homes, rising by 30%.