UK rental prices rise 2.4% in the year to the end of August

The average price paid by tenants in the UK has continued to grow in summer 2017, with the rate of increase now hitting its fastest recorded level since November last year, according to new data.

Findings from the latest HomeLet rental sector index shows that the average monthly rent in the UK now stands at £939. It means that in the year to the end of August, the average tenant will have seen the price paid to their landlord increase by 2.4 per cent.

In London, where the market is far more expensive, rental prices have climbed at a similar pace over the last 12 months. According to the index, the rate of growth in the past 12 months has been 2.5 per cent, with the average London property now costing £1,609 per calendar month.

For the past year, the fastest rate of growth for rental prices was in the south-west of England, where tenants saw prices rise by 3.9 per cent when compared to the year before, and Northern Ireland, where prices have climbed by 3.7 per cent.

The only area that experienced a fall across the past year was the south-east, where rents charged by landlords experienced a fall of some 0.2 per cent when compared to August 2016.

The latest data shows that in the past 12 months, there has been a reversal of the trend towards price declines that were experienced in the months prior.

Whether the recent strengthening in rents achieved, seen generally across all regions of the country, is driven by more robust demand or by some restriction of supply is hard to judge. Either way, landlords will only be encouraged to invest in property over other assets if they’re convinced they can achieve reasonable returns.