Rents fall for first time since 2010

Rents across Britain have fallen for the first time in six years, driven by an increase in supply in London and the South East.

According to the latest Countrywide lettings index, the average UK rent fell 0.6% in February to £921 a month – £5 less than in February 2016 and the first annual drop since November 2010.

The estate agent said the slowdown in growth was driven by a fall in the number of tenants looking for a home combined with higher numbers of properties available to rent in London and the South East.

The surge in the number of homes available to rent follows the rush by landlords to beat the stamp duty deadline last April.

In London rents fell by 4.7% to £1,246, while in the South East they dropped 1.8% to £1,017.

Every other region of the country saw rents rise, although at a slower rate than last month.

Outside London rents rose 0.8% year-on-year, but the rate of growth slowed in nine of the 11 regions in Great Britain.

The East and West Midlands were the only regions recording faster rental growth in February than in January.

Johnny Morris, research director at Countrywide, said: “Rents are growing in most of the country but falls in London and the South East are dragging down the national growth rate.  Recent falls in London and the South East are small in the context growth in recent years.  Rents are a third higher in London and the South East than in 2007.

“Early signs point towards 2017 being a rare year where rents rise faster in the north of the country than in the south. While rents are likely to track any increase in earnings, affordability in London and the South East remains stretched. That is likely to limit rental growth.”

Average UK rent rises for February

Source: Countrywide