The UK’s private rented sector has seen rents increase by 1.3% in the 12 months to July 2019, with the latest official figures showing no change since May of this year.
A further breakdown of the data published by the Office for National Statistics (ONS) shows that rents grew strongest in Northern Ireland, up 2.1%, followed by England at 1.4%, while Wales and Scotland saw growth of 1% and 0.9% respectively,
Since the beginning of 2016, slower growth in London has triggered a general slowdown across the UK, but with stronger growth returning to the capital throughout 2019, rents elsewhere have also picked up.
UK rents excluding London increased by 1.5% in the 12 months to July, while in London they increased by 0.9%, and these figures represent the highest annual growth since September 2017. Looking further back, the data shows that private rental sector rents have increased by 7.8% since January 2015.
Regionally, the East Midlands have seen the largest annual rent increases, up 2.1%, unchanged since April 2019. This was followed by the South West with a rise of 2%, unchanged since May 2019, and Yorkshire and the Humber also saw a rise of 1.9%, up from 1.8% in June 2019.
By contrast, the North East saw the slowest annual growth, up by just 0.7%, despite an increase of 0.2% between June and July. The North East was followed by London, which saw an increase of 0.9%, unchanged since May 2019.
According to David Smith, policy director for the Residential Landlords Association (RLA), the fact that rents are beginning to fall in real terms serves as an indication that the market is functioning correctly.
‘It demonstrates clearly that introducing rent controls linked to inflation, as called for by some, would leave tenants worse off as rents would rise faster than they currently are. Rising demand for and falling supply of homes for private rent risks considerable increases in rents which will only hurt tenants,’ he pointed out.
‘It is vital that the government stops blaming landlords for the housing crisis and introduces positive, pro-growth measures, to support the majority of landlords who do a good job in providing the homes to rent the country desperately needs. All the talk of longer tenancies will mean nothing if the homes to rent are not there in the first place,’ he said.
Meanwhile, rents are likely to be squeezed higher due to a fall in the supply of private rented housing, coupled with increased demand, according to the latest figures from the Royal Institution of Chartered Surveyors.
Despite efforts made by the government to increase home ownership levels, tenant demand has continued to grow, and RICS points out that a rise in the number of enquiries from new home buyers in July was reported by many respondents to its latest residential market survey.