Residential rents rise by 8.4% in last 8 years
Published by Daniel Jones
Residential rents in the UK have grown by 8.4 per cent over the past eight years, according to new figures published by the Office for National Statistics (ONS).
Its Index of Private Housing Rental Prices report showed that between May 2005 and May 2013 there was an 11 per cent rise in London, the largest increase in the country. Tenants in the east of the UK are paying 8.3 per cent more in rent now than eight years ago.
The smallest rental increases were witnessed in the north-east (5.2 per cent) and East Midlands (5.3 per cent).
Despite the growing figures, rents are now rising at a lower rate than average house prices, while the growth has also started to slow down.
In the 12 months to May the amount paid every month by tenants went up by 1.3 per cent, in contrast to the ONS house price index which accelerated at 2.6 per cent. Alternative rental measures have also gone up by 3.5 per cent over the same period of time.
Speaking to the Financial Times, Lucian Cook, head of residential research at Savills, said: "The rent rise reflects what's happening at the lower end of the housing market, where there are very significant price constraints because of limited mortgage availability."
Matthew Pointon, a property expert from Capital Economics, also told the source that the recent increase seen across the buy-to-let
sector will help to ease constraints on supply, which should lead to rental growth slowing further.
"A lower estimate of rental inflation would point to a lower sustainable growth rate for house prices," he added.
Ian Fletcher, director of policy at the British Property Federation, went on to say that this index from the ONS was very welcome as "for too long" there had been a lack of official statistics on rental growth.
This has led to "all manner of surveys and commentators all too prepared to paint a false picture of what is happening to rents in the private rented sector".
Published on: July 2, 2013
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