Residential rental growth in Britain is easing slightly, according to the latest Landbay Rental Index.
Rents rose marginally, by 0.09%, during the last month. This was down from the 0.12% recorded during August.
Ups and downs
Overall, rental prices were up by 1.65% year-on-year, taking the average monthly rental cost to £1,187.
In London however, rents slipped by 0.04% month-on-month, meaning average monthly rents in the capital are now £1,891.
North of the border, monthly rents grew by 0.21% in the month and by 1.79% year-on-year. Rents in Scotland are now £720 per month. In Wales, rents increased by 0.08% over the month and 1.34% year-on-year to hit £632.
English rents increased slightly by 0.09% month-on-month and 1.66% year-on-year. Rents here are now £1,219 per month.
One-bedroom rises
A further analysis of the figures indicates that rents for one bedroom properties are rising, as rental demand for smaller rental properties remain buoyant. For the UK as a whole, Scotland saw the largest growth for one-bedroom properties, with rents up by 0.36%. This was closely followed by the East of England (0.35%) and the East Midlands (0.29%).
John Goodall, chief executive officer of Landbay, believes the figures make for interesting reading. Housing Minister Gavin Barwell has called for lower minimum space requirements for new build homes.
Mr Goodall said: ‘Housing has been high on the political agenda this week and it seems that policy makers are resolute in their ambitions to make home ownership more affordable for people across the UK. There’s no denying most people aspire to own their own home, but it’s critical that efforts to bolster the countries housing stock don’t overlook the importance of the buy-to-let market for a supportive and sustainable housing market.’[1]
Residential rental growth in the UK slows during September
Buy-to-let importance
‘The fact remains that those building up toward a house purchase rely on a well-served buy to let market to ensure that excessive rental growth doesn’t dampen their purchasing power. The challenge is exacerbated by record low interest rates, which may make mortgage borrowing cheaper for those able to buy a home, but also mean that house prices, and indeed rents, are growing more quickly than the money they have saved in bank and building society accounts,’ Goodall explained.[1]
‘The overall picture is one of moderating rents, which is good news for those in shared accommodation, but an under supply of one bed properties will continue to restrict the ability for aspiring home owners to save up for a house of their own,’ he concluded.[1]
[1] http://www.propertywire.com/news/europe/rental-growth-uk-residential-market-slowing-latest-index-shows/