Private UK rents lifted by 8.4% to £1,286 on average in the 12 months to August, according to the latest data from the Office for National Statistics.
The body says: “This was down from 8.6% in the 12 months to July, and was below the record-high annual rise of 9.2% in March.”
Across the nation, average rents rose 8.5% to £1,327 in England, they also lifted 8.5% to £752 in Wales, and increased 7.6% to £969 in Scotland, over the same period.
Hampshire Trust Bank managing director, specialist mortgages, Alex Upton says: “With tenant demand remaining robust and rental stock not quite keeping pace, it’s no surprise that rents are climbing.
“As the Royal Institution of Chartered Surveyors has noted, while more landlords are bringing properties to market, tenant demand is still outstripping supply. This imbalance is likely to push rents higher as we move forward.
Upton adds: “Rather than a mass exodus, what we’re seeing is a refinement of strategy among professional landlords who are keen to adapt to the evolving market.
“There’s growing interest in more specialist, higher-yielding investments—such as houses in multiple occupation, or semi-commercial properties—that can provide a better return on investment.”
Fairbridge Capital co-founder and director Aman Bajwa points out: “Today’s figures reveal that the property market has shrugged off the summer lull, and is showing no signs of slowing down, as we enter what is traditionally a busier period.
“Investors are getting back into the property market as interest rates fall, with several sub-4% five-year mortgage deals now available. This, paired with lower inflation, is fueling demand.
“With rents increasing faster than house prices, and rumours that the base rate could hit 4.5% before the end of the year, activity shows no signs of stopping either.
Bajwa adds: “Landlords who haven’t expanded their businesses over the turmoil of recent years are re-entering the market, and new landlords are making their first foray into property investment. To maximise opportunities in the buy-to-let space, flexibility will remain critical.
“Specialist lenders can help customers get access to finance exactly when they need it, to give them the best chance possible of making a successful investment.”
However, Generation Rent points out that today’s data shows that private sector rents in the UK grew at a faster rate than the headline wage growth of 5.1%.
Generation Rent chief executive Ben Twomey says: “Prices in the shops may have stopped rising so quickly, but renters are still seeing our single biggest cost go up faster than our incomes. This isn’t news to renters, who have been feeling this squeeze for a very long time as our landlords snatch away more and more of our wages.
“The government’s Renters’ Rights Bill, published last week, offers many positives for tenants, but the cost of renting crisis will rage on unless Westminster slams the brakes on these runaway rents.”
