UK rents rose to a record high in January
Average UK rents hit a record £1,198 a month at the start of 2018, up 0.7% on December, according to Landbay.
The average cost of renting a home is now rising across every UK region for the first time in almost two years, marking what is expected to be the start of a year of sustained rental growth for the UK.
Even London saw rising rents of 0.03% – up to £1,876 a month – two and a half times the average in the rest of the UK (£760).
This is still £16 a month shy of the £1,893 record set in in the capital in May 2016, but the first month since then that rents have actually risen in London.
Wales had the strongest rental growth of any UK country at 0.10% in January, while Northern Ireland (0.01%) lagged behind.
From a regional perspective, the East Midlands experienced rental growth of 0.18% in January alone, followed by the East of England (0.13%). Meanwhile, rents in the North East paralleled the 0.03% growth seen in London.
John Goodall, CEO and founder of Landbay said: “With all the tax and regulatory changes landlords have shouldered over the past couple of years, an uplift in rents has been on the cards for a while, and is likely to continue into 2018.
“Stamp duty changes pushed up transaction costs for landlords back in 2016, as have a raft of new regulations from the PRA landing in 2017. Furthermore, the Bank of England’s Term Funding Scheme comes to an end this month, pulling away one of the crutches that has allowed many mainstream lenders to keep mortgage rates so low.
“This, together with gradually rising interest rates, will eventually push up borrowing costs for banks, and consequently for landlords, who will have to pass some of these costs onto tenants in the form of higher rents.”