Data from Homelet shows that Brighton, Bristol, Edinburgh and Newcastle showed the highest rental increases in 2015.
HomeLet’s annual review of the rental market shows that rents on new tenancies signed last year in Brighton and Bristol were, on average, 18% higher than on new tenancies agreed in 2014, while rents were up by 16% in both Edinburgh and Newcastle. London and Liverpool also fall into the top rental hotspots for 2015, both with increases of 11%.
Meanwhile, the monthly HomeLet Rental Index shows that, on average, rents across the UK, excluding Greater London, were 4.9% higher on new tenancies signed during the final three months of the year than in same period of 2014. The average monthly rent outside of the capital now stands at £739. The monthly index shows the London market up by 8% on the final three months of 2014 to an average of £1,523.
Martin Totty, Barbon Insurance Group’s chief executive officer, said: “2015 was a year in which rents on new tenancies were up on 2014 in almost every area of the country. While we saw a moderation in the rate at which rents increased during the final months of the year, and even some falls in a number of regions, the sector overall has continued to see strong demand.
“Beneath the headline figures, HomeLet’s data points to some significant variations in rental market performance in 2014, both from region to region and from town to town. In locations such as Brighton and Bristol, demand for rental property appears to have been particularly strong and rents on new tenancies jumped very markedly. In other areas, we saw slower growth.”
On an annual basis, the monthly HomeLet Rental Index shows that rents rose in 10 out of 12 areas, led by London, where rents on new tenancies signed during the final three months of the year were 8% higher than in the same period of 2014, and the South-East (7% higher). The North-West of England, where rents were down 5.1% compared to 2014, and Northern Ireland (down 0.6%) were the exceptions.
“Rents in London have continued to rise more quickly than in most areas of the country, but not at quite the pace of 2014; meanwhile, average rents outside of the capital rose more quickly last year than in 2014,” said Totty, “As a result, we saw a narrowing of the rent inflation gap between London and the regions last year - is this a trend we will see continuing in 2016 from tenants seeking value for money in the private rented sector?”