Yahoo Finance Average UK rents hit £1,000 for first time ever
The average rent in the UK outside London hit £1,000 ($1,388) per month in June for the first time ever, Rightmove revealed, adding that tenants are struggling with a lack of properties.
This comes as more renters move back to the city as lockdown restrictions ease. Earlier, as people were forced to remain indoors during the pandemic, many had opted to move out of cities in search of bigger properties.
Eight out of 10 of some of the biggest city centres saw higher rents in June 2021 than a year before.
“At the start of this year the impact that tenants leaving cities had on rents was clear to see, but with restrictions continuing to lift we’re seeing signs of the city centre comeback," said Rightmove’s director of property data, Tim Bannister.
"As businesses settle into a more structured balance between home and office time, we expect this to continue for the rest of the year."
This has also meant a shortage in supply.
“Tenants across Britain are being faced with low stock and record rents in many areas, likely fuelled by some tenants signing longer leases last year and also perhaps by a rush of people who chose to move back in with family last year, who are now making plans to rent again and in many cases starting to think about their new daily commute," said Bannister.
Read more: House prices surge in Scotland and the north of England as London lags
Rob Cuffe, director at Philip James in Manchester, said the estate agent has seen demand for properties in the city centre surge in the last month and that "shortage of stock is now our biggest problem".
Rightmove’s Quarterly Rental Trends Tracker, based on over 470,000 properties, showed that the number of prospective tenants contacting agents about properties for rent is currently 10% higher than in July 2020 across the UK.
This is despite last year benefitting from pent-up tenant demand when the rental market re-opened in mid-May in England.
Rental properties are finding a tenant quicker than ever before at an average of 21 days, and there is an annual drop of 36% in the number of available rental properties.
The report also said asking rents are 2.6% higher now than in the first quarter 2021 and 6.2% higher than this time last year, the biggest quarterly and annual jumps ever recorded by Rightmove.
London is the only region with rents lower than this time last year, though rents in the capital have increased this quarter for the first time since before the pandemic.
London rents grew by 1.5% in Q2 compared with Q1, marking the first increase since Q1 last year before the pandemic started. They are now down by 3.1% annually, with the quarterly increase being driven by the outer London zones.
As far as city centres go, Nottingham's asking rents are up annually by 6.8%, and the next best performing city centre is Liverpool, where rents are up by 3.8%.
Inner London (-6.8%) and Edinburgh (-4%) saw a fall in average asking rents, but higher tenant demand is likely to lead to rents rising again over the coming months, Rightmove said.
When it comes to rental hotspots, areas that have seen the biggest rent rises over the past year include city suburbs, commuter towns and coastal locations. Rochdale, Folkestone and Farnham have all seen asking rents jump by more than 25%.
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