Potential rental income is one of the key factors buy-to-let property investors consider when evaluating an investment, so it will be encouraging news to many that average rents across the UK are on the increase.
The latest figures from the Office for National Statistics (ONS) and HomeLet, an organisation that provides support for the UK’s private rented sector, have offered an insight into the rate of growth in rental values over the past year.
According to the ONS data, private rental prices paid by tenants in the UK increased by 1.2 per cent in the 12 months to March 2019, a slight rise from the 1.1 per cent growth rate recorded in February this year.
The regional picture showed private rents going up by 1.2 per cent in England, 1.1 per cent in Wales and 0.7 per cent in Scotland.
These trends were also reflected in the HomeLet Rental Index for April 2019, which showed typical rents across the UK went up by two per cent from a year earlier, reaching a monthly average of £936.
In London, the average monthly rent paid by tenants now stands at £1,617, more than twice the overall figure for the rest of the UK when the capital is excluded (£775). This underlines the high cost of living in London, which is fuelling demand for living space in commuter hotspots within travelling distance of the city, such as Luton.
A resilient market
Discussing recent trends in the private rented market, Martin Totty, chief executive of HomeLet, said there were a number of regional “hotspots” where rents increased faster than the UK average during the first three months of 2019, such as Wales, the north-east and the north-west.
He added: “Recently released annual results from a number of major quoted property agents point to a resilient private rented sector in contrast to a subdued sales market.
“With a still unclear outcome of the Brexit political impasse and the increasing prospect of a further extended delay in the UK exiting the European Union, the contrasting fortunes of the two main segments of the housing market seem likely to continue for some time.”
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