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Regional rents now rising as fast as London

Posted on 2015-05-13

  • Rents have risen in 11 out of 12 regions across the UK in the three months to April 2015
  • The average rent in the UK is now £916 (£730 excluding Greater London)
  • The average rent in Greater London is now £1,436

New findings from the HomeLet Rental Index show that the average rent across the UK is now rising in line with those in Greater London for the first time and at the fastest rate since the inception of the Index in 2008.

The latest HomeLet Rental Index figures show that the rents agreed on new tenancies in London over the three months to the end of April were 7.5 per cent higher than in the same period a year ago, compared to a 7.4 per cent increase across the rest of the UK. After a year of rents in London rising at over twice the rate of the UK average, growth rates have now converged, representing a slowdown in the growth of rents in London and an acceleration elsewhere in the UK.

The index for the three months to April 2015 demonstrates steady growth in rent prices across the UK, with 11 out of 12 UK regions recording price rises. The figures show that the average rent on a tenancy signed in the UK during the three months to April 2015 was £916, compared to £902 last month and £833 for the same period a year ago.

In Greater London, the average rent now stands at £1,436 for the three months to April 2015, compared to £1,427 last month and £1,336 for the same period a year ago.

Annual variance comparison figures: Greater London vs rest of the UK

HRI 1

Annual variance comparison figures: Greater London vs rest of the UK

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Commenting on the report, Martin Totty, Chief Executive Officer, Barbon Insurance Group, parent company of HomeLet, said: “For the first time we are seeing rent price growth rates in Greater London converge with those across the rest of the UK. During 2014, London rent price growth far outpaced other regions but in 2015 we are seeing the emergence of a different pattern. What this tells us is that the private rental market is experiencing demand nationwide and that it is not simply a London phenomenon that increasing numbers of people are requiring privately rented property.” 

April 2015 HomeLet Rental Index regional rent price figures

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Martin Totty continued, “While there have been periods in recent years where London’s rent price growth has moved more in line with other parts of the UK, most notably during the period following the financial crisis, the capital has always remained significantly ahead. The convergence suggests that after a lengthy period of substantial out performance in terms of rental increases, the pace of growth in London has slowed – while the rest of the UK is catching up.”

About the HomeLet Rental Index

As well as information on rental amounts, the HomeLet Rental Index also provides information on tenant demographics, such as their average age, income, previous residential status and property type they’re applying to live in. In addition, data is gathered on how many people share a rented property –to get a real feel for the lifestyle of tenants and see how external factors, such as the lack of mortgages and increase in unemployment, are affecting how and where people live.

Data is gathered from HomeLet’s tenant referencing service, and rental amounts are based on actual achieved rental prices with accurate tenancy start dates in a reported month, rather than advertised costs. Up to 1,700 applicants are referenced every day, so information in the report is extremely comprehensive, accurate and up to date.

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