9th
Sep 2021
A PRS Insurance Company’s latest indicator shows the sector’s average UK monthly rent is on a continual increase as for the third consecutive month it is at an all-time high.
The average monthly rent now stands at £1,053 which is 6.9 per cent higher than the corresponding period last year and a rise of 2.3 per cent from August.
Wales has enjoyed the highest annual increase of 12.8 per cent from the same period last year and is now £723 pcm.
London is at long last fighting back against the continual decrease in average monthly rent during the pandemic which has now stopped and is up by 3.6 per cent from the same time last year to £1,713 pcm.
The company reports that every UK region has an annual price increase, with the exception of Northern Ireland experiencing a monthly dip.
Rob Wishart, head of business intelligence at HomeLet & Let Alliance, says: “Typically, rents for new tenancies will rise in line with the rate of inflation, but that’s not been the case in the past few months.
“The demand for housing and certain property types is outstripping supply in many areas, causing upward pressure on rental prices. We can expect the increase in rents to continue for the foreseeable future, with many regions now seeing unprecedented demand for housing stock and landlords.
“In the capital, we have seen yet another price rise, and we may see London accelerate at a faster rate than the rest of the country in the coming months, as international travel ramps up and rates of working from home move in the opposite direction.
“On the whole, the private rented market has been exceptionally resilient throughout the pandemic, so it’s no surprise that the level of investment is increasing through sectors like Build To Rent. Consistent yields over the long term coupled with capital appreciation have only bolstered confidence in the industry even in the face of the disruption we’ve had over the past 18 months.
“There’s no doubt that further challenges are ahead in the short term; with the end of the furlough scheme, which still supports around 2m people, we expect claims on rent protection products to increase further. Whilst the pandemic has accelerated the demand for rent protection products, it’s become integral to many letting agents management propositions and has supported the confidence we’re seeing in the sector.”
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