UK rents rise fastest in five years

Rents are rising at the fastest rate in five years, with the average newly advertised rental price reaching £969 a month, new figures show.

The latest Office for National Statistics figures showed private rents have risen by 2% in England in the 12 months leading up to January. That’s the largest annual growth rate since February 2017.

Private rental prices grew by 1.4% in Wales and 2.6% in Scotland in the 12 months to January 2022.

Read more: Average UK house price hits £275,000

Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, said: “Rents are rising faster than any time in the past five years, forcing tenants to choose between squeezing their spending even harder, or uprooting their life. Either way, they’ll end up worse off.

The East Midlands saw the highest annual growth in private rental prices (3.6%), while London saw the lowest (0.1%).

The ONS said the small increase in London reflected a drop in demand as remote working has shifted housing preferences because workers no longer need to be close to offices.

Property website Zoopla reported last week that the average annual UK rental growth had hit a 13-year high with rents increasing 8.3% to £939 by the end of 2021. That is on average £62 higher than before the pandemic.

Coles added: It looks like rises are set to go further too. RICS research found that a slide in the number of properties for rent and another rise in tenant numbers is filling agents with confidence that rental prices will be on the march for months or even years. It expects rent rises to average 5% over the next five years.

In yet another blow to those hoping to move out of rental property and into their own home, average house prices increased over the year.

Read more: UK consumer prices hit new 30-year high as inflation rises to 5.5%

House prices rose to £293,000 in England, to £205,000 in Wales and across the UK to £275,000. All the highest nominal prices since records began in 1995.

“Those who can’t stretch their finances to cover their costs face the horrible upheaval and expense of moving home. If their current landlord withholds any of their deposit, they’ll have to find more cash to cover this, on top of the moving costs themselves, which means they’ll be worse off – whatever they do,” Coles said.

Watch: Am I wasting my money by renting?