Private rental prices paid by tenants in the UK rose by 5.5% in the 12 months to August 2023, up from 5.3% in the 12 months to July 2023.
This is according to the latest data from the Office of National Statistics which also split the figures into a country breakdown.
Annual private rental prices increased by 5.4% in England, 6.5% in Wales, and 6.0% in Scotland in the 12 months to August 2023.
Within England, London had the highest annual percentage change in private rental prices in the 12 months to August 2023 at 5.9%, while the North East and South West saw the lowest (4.8%).
London’s annual percentage change in private rental prices was at its highest annual rate since the London data series began in January 2006.
Commenting on the figures Antony Roberts estate agency lettings manager Harriet Scanlan said: “‘We are still very much in the grips of stock-deprived market. Just this week we launched two new rental properties which both attracted multiple offers and subsequently exceeded asking price.
“There is plenty of evidence like this which clearly demonstrates how lack of supply combined with high demand affects the rents achieved”.
She insists one of the primary drivers for private landlords exiting the buy-to-let sector are changes in tax regulations, primarily the reduction of mortgage tax relief.
“In recent months, the interest rate hikes have also had a direct hit on some landlords’ profit margins. However, those landlords who are able to hold their nerve are being rewarded with minimal-to-no void periods and escalating rental prices.”
North London estate agent and former RICS residential chairman Jeremy Leaf says these rental figures reflect what has been seeing on the ground – that shortage of stock is continuing the upwards pressure on rents at a time when students are adding to tenant numbers.
“The burden of higher mortgage rates as well as tax and regulatory issues are persuading landlords to quit the sector which is not helping keep rents in affordable territory.
“However, we have noticed the difference between the rents charged on new tenancies and those who are renewing existing arrangements as tenants are reaching an affordability ceiling.
He concludes: “ Landlords recognise the importance of reliable, long-term tenants rather than maximising their returns unless, of course, their costs are getting out of hand.”
