‘Strange’ market still showing rent increases in almost every region

Another market snapshot from HomeLet suggests that there was a 2.2 per cent average rent increase across the UK in the year to the end of October.

This takes the typical rent to £974 pcm - although when London is excluded that drops down to £821 pcm and the annual rise was a healthier 4.2 per cent.

No fewer than 10 of the 12 regions monitored by HomeLet showed a year on year increase in rental values between October 2019 and October 2020, with the South West seeing the largest increase for the second month in a row - a hefty 6.2 per cdnt. 

However, rents in London continue to fall annually - down 3.7 per cent between October 2019 and October 2020. Last month the average rental value in London (£1,603) was 95 per cent higher than the rest of the UK, excluding London. 

The London results prompt Martin Totty, chief executive at HomeLet, to suggest there may be something strange, if unsurprising, happening in the rental sector.  

“In the key Greater London area, it’s maybe more about demand falling faster than supply leading to depressed rents, whilst in the regions, perhaps the reverse is more typical, with a tightening of stock ‘pinching’ demand and moving average rates gradually upwards” he notes. 

“And, against all of this we have the backdrop of a more buoyant sales sector, albeit one with a still uncertain outlook beyond next March.

“For landlords prepared to tough it out, it looks like in most parts of the country, demand is still there, whilst in the capital, equilibrium may seem a little further away. 

“At least the government recognise the value of the property sector and the multiplier effect it has on the economy. This time around, that argument now seems unequivocal, with letting agents able to continue ‘business as usual’ while adhering to all Covid safety guidelines.

“Landlords and tenants need each other and for the private rented sector to fulfil the important role it has in the UK housing market, it really needs to be allowed to get on with creating its own market – and find its equilibrium.” 

Region	Oct-20	Sep-20	Oct-19	Monthly Variance	Annual Variance
South West	£892	£902	£840	-1.1%	6.2%
East Midlands	£678	£678	£642	0.0%	5.6%
Wales	£657	£650	£623	1.1%	5.5%
North West	£764	£770	£727	-0.8%	5.1%
East of England	£961	£967	£924	-0.6%	4.0%
West Midlands	£733	£747	£706	-1.9%	3.8%
Yorkshire & Humberside	£675	£673	£653	0.3%	3.4%
South East	£1,053	£1,074	£1,020	-2.0%	3.2%
Scotland	£693	£683	£674	1.5%	2.8%
North East	£546	£558	£538	-2.2%	1.5%
Northern Ireland	£653	£657	£672	-0.6%	-2.8%
Greater London	£1,603	£1,646	£1,665	-2.6%	-3.7%
UK	£974	£987	£953	-1.3%	2.2%
UK excluding Greater London	£821	£828	£788	-0.8%	4.2%