Following a year of rapid growth, rents now are seeming to ease a bit, the latest buy-to-let index from Your Move and Reeds Rains shows.
In August 2015, rents were 5.5 per cent higher than a year ago, which was a slowdown in comparison to July’s annual growth rate of 6.8 per cent. On a monthly basis, there was a small drop of 0.1 per cent.
“August has witnessed a break in a series of blistering rent rises. Yet this mild correction comes on the back of a whole year of acceleration. Rents are rising rapidly on an annual basis, underpinned by an improving economic picture for many potential tenants – and the peak lettings season is only just about to start this autumn.”
“There is also no major change to the fundamentals of supply and demand. This means that in the longer-term, faster rent rises may become a semi-permanent feature of the British property market. Alongside purchase prices, rents will continue to rise rapidly until something happens to address a drastic shortage of homes in the UK,” Adrian Gill, director of estate agents Reeds Rains and Your Move, said.
Despite a slower picture across the board, three individual regions of England and Wales saw rents hit fresh records in August. In the West Midlands average rents of £586 per month represent the highest levels on record, while rents in the East Midlands have set their own record at £596.
As the third region to see record rents, the East of England has also overtaken London to see the fastest annual growth of 11.5 per cent – ahead of 10.2 per cent annual increases in the capital. This takes average rents in the East of England to £843 per month. Meanwhile, while relegated to second place in terms of annual rent rises, London’s tenants still pay by far the most in absolute terms, with average rents of £1,278 in August.
