After UK average rent hit the £1,000 mark for the first time on record in June 2021, it has kept rising. In august it rises to £1,053, up 2.3% from July.
This figure signifies a 6.9% year-on-year increase on the August 2020 average rental price of £985 PCM.
London has seen the third price rise in as many months after a year of decline, with an annual increase of 3.6% to £1,713 PCM.
Excluding London, the average UK rent price has increased 8.1% year-on-year to £892 PCM.
Wales has seen the highest year-on-year rise. The average rent is now 12.8% higher than this time last year, up to £723 PCM.
In Scotland, average prices were 9.5% higher than at the same time last year, at £758 PCM.
Northern Ireland’s average rental price for August was £704, up 5.4% from August 2020. Northern Ireland is the only region which hasn’t seen a rise since July 2021 – with the average price staying the same
Every region has seen an increase on August 2020, with all regions other than London surpassing pre-Covid rental prices.
Commenting on the latest data, Rob Wishart, Head of Business Intelligence said:
Typically, rents for new tenancies will rise in line with the rate of inflation, but that’s not been the case in the past few months. The demand for housing and certain property types is outstripping supply in many areas, causing upward pressure on rental prices. We can expect the increase in rents to continue for the foreseeable future, with many regions now seeing unprecedented demand for housing stock and landlords.
In the capital, we have seen yet another price rise, and we may see London accelerate at a faster rate than the rest of the country in the coming months, as international travel ramps up and rates of working from home move in the opposite direction.
We’ve seen record levels of new customers this year. As our group expands, so does the level of insight that we can provide for our customers, processing over 1m tenant references a year; we’ll continue to monitor the market closely.
On the whole, the private rented market has been exceptionally resilient throughout the pandemic, so it’s no surprise that the level of investment is increasing through sectors like build to rent. Consistent yields over the long term coupled with capital appreciation have only bolstered confidence in the industry even in the face of the disruption we’ve had over the past 18 months.
There’s no doubt that further challenges are ahead in the short term; with the end of the furlough scheme, which still supports around 2m people, we expect claims on rent protection products to increase further. Whilst the pandemic has accelerated the demand for rent protection products, it’s become integral to many letting agents management propositions and has supported the confidence we’re seeing in the sector.Rob Wishart, Head of Business Intelligence
THE LARGEST AND MOST RELIABLE SOURCE OF AVERAGE RENTAL DATA IN THE UK
The Rental Index data is qualified through high-quality tenant referencing, carried out on behalf of over 4,500 UK letting agents. As a group we reference over 1m tenants a year, enabling reporting on newly agreed tenancy applications, with historic data for over 13m tenancy applications.