Majority of regions see rent growth as investment in property continues apace

on Feb 27, 2015

Latest index figures show that across the UK, rents grew by 2.5 percent at the start of the year, based on data gathered from new tenancy agreements. The HomeLet rental index figures reveal that of the 12 regions covered, nine of them returned to growth in 2015. Excluding the capital, average monthly rental income is now £707, rising to £889 with Greater London included.

The highest level of growth was recorded in Scotland, the East Midlands and East Anglia, with increases of 5.7 percent, 6.2 percent and five percent respectively.
The figures show that the average rent in the East Midlands is now £617, a monthly rise of 6.2 percent and an annual increase of 7.2 percent. In Scotland, the average monthly rent soared to £651, a rise of 5.7 percent month-on-month and 9.4 percent year-on-year.

Greater London, unsurprisingly, witnessed the steepest rise with average rents reaching £1,425 in January, up 2.3 percent on the previous month and a 13.4 percent rise since the same time last year. Other areas have seen rents rising more gently with Wales witnessing a month-on-month rise of 2.3 percent and a year-on-year rise of just one percent
In contrast, North East England, Northern Ireland and the West Midlands saw a decline in rental prices according to the index figures. Overall, having seen rental income decline in many areas towards the end of 2014, the index shows that most regions are now returning to growth.

Northern Ireland currently has had the poorest performing rental sector. Average rents edged 0.5 percent lower on the month to £556 and were down 2.3% year-on-year, the only annual decline in the whole of the UK. This is perhaps surprising, as the province is experiencing a high level of activity in its residential property market as well as rising employment figures. This will have a positive impact on rent levels over time provided the trend continues.

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