Average rent continues to rise across UK and in London

Latest figures show average rent has continued to grow since new tax rates came into force, according to new data.

According to the April HomeLet Rental Index, rents agreed on new tenancies across the UK over three months to the end of April, have continued to grow. This is the first comprehensive data published on the UK’ s private rental sector since 6 April, when the government introduced a 3% point stamp duty surcharge on all purchases of residential property made by someone who already has a home.

The April HomeLet Index shows that since the new tax rates, rents have continued to grow at a remarkably consistent rate, revealing that rents on new tenancies signed on a UK rental property outside of London over the three months to April 2016, were on average, 5.1% higher than in the same period last year.

In the Capital, new tenencies signed in the three months were 7.7% higher than a year ago.

Its Index shows that the average rent outside London rose to £746 a month, and within Greater London, the monthly outlay for tenants hit an average of £1,543.

HomeLet said rents were rising faster in Scotland than anywhere else in the UK, with the average up by 11.4% year-on-year to £704 a month. The next highest rise was in the east Midlands, where new tenancies cost 7.9% more than in April 2015 at an average of £646 a month.

In the north-west of England rents on new tenancies were down by 1% year-on-year.

Martin Totty, Chief Executive of Barbon Insurance Group, which owns HomeLet, said: “It may be that over the next several months the trends observed in the rental market begin to reflect the signs of some slowdown in the rate of house price growth that we are now beginning to see, and that will be something to watch closely.

“But more broadly there has been very little to alter the fundamental relationship between demand and supply, especially in those parts of the country where demand-side pressure is greatest.”

The Rental index will be monitored closely over the next few months.

Reports from the Office for National Statistics reported on Friday that rents in Great Britain rose by 2.6% in the 12 months to March.

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