The latest HomeLet Rental Index reports strong annual growth in value of new tenancies and tenant income
The average rent for a tenancy sign in the three months to April 2014 was £916, marking an increase of 10 per cent on figures for the same period a year ago.
When London is not included in the figures, average rents rose 7.4 per cent to £730 with annual growth noted in every region except Wales where rents fell by 0.7 per cent to £573.
Scotland’s rents rose 6.2 per cent to £635 while Northern Ireland noted 5.2 per cent growth to £594.
In London, average rental values for a new tenancy were £1,436 per month making them £100 more expensive than at the same point last year.
Growth rates in Greater London have now converged with national rates at 7.5 per cent while the South West noted the highest annual growth at 15.5 per cent.
Rents were also up in East Anglia, the West Midlands and the South East by 8.4 per cent, 7.9 per cent and 7.4 per cent respectively.
Growth of between 3.4 per cent and 4.3 per cent was seen in Yorkshire and Humber, the North East, the North West and the East Midlands.
“For the first time we are seeing rent price growth rates in Greater London converge with those across the rest of the UK,” said Martin Totty, Chief Executive Officer of Barbon Insurance Group; Homelet’s parent company.
“What this tells us is that the private rental market is experiencing demand nationwide and that it is not simply a London phenomenon that increasing numbers of people are requiring privately rented property.”
He suggested that London rental growth was slowing while the rest of the UK is catching up.
The report also suggested a 2.5 per cent rise in tenant income compared to a year ago, meaning potential risk for buy to let landlords are decreasing as tenants are more capable of meeting payments.