The majority of England and Wales experienced a rise in rental prices in the last year to the end of September, according to the latest reports. But there was one area of the country that performed better than anywhere else thanks to consistent demand driven by higher job creation numbers and a rise in start-ups.
According to the latest reports released by Your Move, the average nationwide rental price now stands at some £938 per calendar month. This means that in the course of the last year, the price paid by tenants has risen by an average of 3.2 per cent across the country.
However, as London and the south-east continued to struggle to improve on last year’s prices, it was a non-traditional region that helped drag the market forward. Led by the cities of Manchester and Liverpool and the strong demand for rental homes that exists in both, rental prices in the north-west of England were up by 3.6 per cent year on year. This took the average price in the north-west as high as £633 per calendar month in September.
The north-east remains the cheapest region in the UK at the moment for tenants, with a price of just £536 per month, but the fact that prices are low as jobs start to pick up in Newcastle could mean that it’s a property hotspot in years to come.
Coming in just behind the north-west among the strongest performers nationwide is the East Midlands, where prices rose by as much as 3.4 per cent over the past year. They were also up by 2.9 per cent in the East of England, but the south-west experienced a fall. London was also one of the only areas of the UK to experience monthly falls in rental price in September, with the cost to tenants 0.1 per cent lower than in August.
“Once again the strongest rent growth was found in the areas away from London and the South East. As activity in the capital slows, prices and activity have risen in the North,” said Martyn Alderton, national lettings director for letting agents Your Move and Reeds Rain.
It was also discovered that the best returns in the UK are found in the north of England at present. Investors looking towards cities like Newcastle will be pleased to know that the north-east city has welcomed some of the very best rental yields in the country in the past month, posting an average of 5.1 per cent return for landlords. The only area of the country that can match it at the moment is the north-west, where returns at the moment are sat at around five per cent.
Given the performance of these two areas, it’s clear that the northern areas of England such as Liverpool and Manchester are fantastic investment options at present, outpacing the more traditional hotspots.