Rent prices for new tenancy agreements have risen across most parts of the UK in the three months to the end of April, according to the latest HomeLet Rental Index.
Rents Rise on New Tenancy Agreements, Reports HomeLet
Rent price growth in the UK is currently being driven by substantial increases in Scotland and the East Midlands, believes the firm.
The average rent price on a new tenancy agreement in the private rental sector in the UK, excluding Greater London, rose by 5.1% to £764 per month in the three months to April compared with the same period last year.
This rental data, the first to be released since the 3% Stamp Duty surcharge for landlords was brought in on 1st April, shows that rent prices on new tenancies continue to rise at a much faster rate than inflation.
According to the index, rent price growth was led by Scotland, where rents increased by 11.4% annually to £704 per month. The East Midlands followed at 7.9%, taking the average rent to £646.
In London, rents rose by 7.7% to £1,543 a month. However, this rate of growth is considerably lower than the double digit increases recorded in 2015.
Just one region recorded a decrease in rents – prices fell by 1% in the North West.
The Chief Executive of Barbon Insurance Group – HomeLet’s parent company – Martin Totty, comments: “The April HomeLet Rental Index has been much anticipated given the potential impact of the Stamp Duty changes on the private rental market; for now, however, rental price growth in most areas of the country is unchanged from the trends observed over almost three years.
“It may be that over the next several months, the trends observed in the rental market begin to reflect the signs of some slowdown in the rate of house price growth that we are now beginning to see and that will be something to watch closely.”
Recent research from the Residential Landlords Association suggests that the majority of landlords are considering putting their rent prices up to accommodate tax changes.