UK rents on the rise but failing to keep pace with inflation

Average UK rents continued to rise between July and September, but failed to keep up with inflation, according to The Deposit Protection Service (The DPS).

Its latest Rent Index shows that during Q3 average UK rents increased by £7 (0.91%) to £778.

This is less than half the rise in inflation during the same period which was 1.90%.

Rent rises for terraced and semi-detached properties were above inflation (over 4%) during Q3 when compared with the same period in 2018.

Meanwhile, rent increases for flats and detached properties were below inflation, recorded at 1.36% and 0.8% respectively across the same timeframe.

Between July and September, Yorkshire and The Humber saw the largest rental increase of £19 (3.6%), taking the typical rent for the region up to £552.

The only regional quarterly falls were recorded in the East Midlands and the West Midlands, down £13 (-2.17%) to £578 and £1 (-0.19%) to £620 respectively.

The cheapest place to rent in the UK during Q3 was the North East, where rents increased by £3 (0.65%) to an average of £526.

On the other hand, London remains the most expensive rental region in the UK, with an average monthly payment of £1,333 following year-on-year growth of £43 (3.34%).

Scotland and Wales were the only regions to experience year-on-year and quarter-on-quarter rental decreases. Rent north of the border dropped by £6 (-1.02%) to £619, while Welsh rents fell by £8 (-1.43%) to £578.

The DPS estimates that UK tenants typically spend 32% of their wages on rental payments.

"Two consecutive quarterly increases have seen rents reach the highest value since the Rent Index launched in 2017 following a period of decline during 2018," says Matt Trevett, managing director of The DPS.

"However, average rents in the third quarter of 2019 did not keep up with inflation, as they did in Q2 2019. This suggests rental values in the UK are regulating themselves against inflation."