The property type that saw the highest increase in rents in August 2015 were three-bedroom properties, according to the first monthly rental index from buy-to-let mortgage lender Landbay.
The data showed a 4.6 per cent rent rise for three-bed homes compared to the UK average of 3.3 per cent increase in August.
Areas to lead the rental growth of three-bedroom homes are mainly located within commutable distance of London, such as Windsor and Maidenhead (up 22 per cent to £1,936), up-and-coming Southend on Sea (up 20 per cent to £1,121) and Swindon (up 13 per cent to £813). The Top Ten all saw annual rent increases of over 10 per cent.
John Goodall, co-founder and CEO of Landbay comments:
“Rents for 3 bedroom family homes are racing ahead of the rest of the market at the moment. This trend is particularly strong in commuter hotspots outside of London, with 12 of the 20 areas with the fastest growing 3 bedroom rents within an easy commute of the capital. The jobs market is firing on all cylinders at the moment, and it looks like professionals with families are relocating to where the best paying jobs are. People relocating for a new job often rent first and buy later. Renting is a great way to settle into a new area fast – and to ‘try-before-you-buy’ to see if you actually like living there.
“For investors in the private rental sector, our data makes family homes in the southeast look like an attractive proposition. As well as performing well now, rents for 3 bedroom homes saw the smallest falls when rents dipped in 2013. The challenge for investors looking to benefit is finding suitable properties for professionals at a cost that produces a good yield.”
Across the UK as a whole, rents climbed by 3.3 per cent in the last year to £1,281.
The rise is well ahead of inflation, which grew by just 0.1 percentage point in the year to July 2015, and closely tracks wages which have climbed 2.9 per cent in the last year.
Average UK rents fell between May and July 2015, with August seeing the first monthly rise in rents since March.
Across all property sizes, the top rental risers outside of London were Southend on Sea (up 12.6 per cent), York (up 12.1 per cent) and Wrexham (up 11.1 per cent).
