Average rents up 2.5% in January
Average rents across the UK rose by 2.5% in January 2019 when compared to the same month a year previously, HomeLet’s Rental Index has found.
The average monthly rent is now £932. Rents in London increased by 3.7% in January 2019 from the same month of 2018; the average rent in the capital now stands at £1,588 a month.
When London is excluded, the average UK rental value was £775 in January 2019, up 2.0% on last year.
Martin Totty, chief executive at HomeLet, said: “Positively for both tenants and landlords, this year we’ve seen stability in UK rental price growth, with increases remaining broadly in line with the rate of consumer inflation.
“For landlords there remains a sustained demand for property, with the private rental sector continuing to provide the market with both flexible and long term housing options.
“The slowdown in the rate of house price growth, as reported by the Nationwide House Price Index is being driven by the depressed London market, which saw house prices decline by 0.8% during the last four months of 2018.
“In contrast, we have seen average rental values in the capital rise by over 4% in the latter stages of the year. Ultimately, we would expect this theme to continue in London, if the demand for property outweighs supply.”
Rents rose in 11 out of the 12 regions covered in the research. In January average rental values in London (£1,588) were 70.4% higher than the UK (£932).
When London is excluded the average rent in the UK was £775 in January and average rents in London (£1,588) were 104.9% higher than the rest of the UK.
Totty added: “Private residential landlords will continue to play a key role in the wider UK housing market. Whilst the outlook for property investors remains positive, one of the key concerns for the market in 2019 would be a potential lack of supply in certain regions.
“The government’s squeeze on private landlords via taxation changes and more regulation could discourage their continued participation in this important sector. Unlike the trends we saw in 2018, any reduction in supply could lead to rental increases that are above the rate of consumer inflation.
“The data used in the HomeLet Rental Index provides us with a forward-looking view of the rental market, so it will be interesting to see how this theme develops in early 2019.”