Private rental prices paid by tenants in the UK increased by 2.6% in the 12 months to April 2016, unchanged when compared with the year to March 2016.
Since January 2011 England rental prices have increased more than those of Wales and Scotland, and that trend continued last month, with the data from the private housing rental index from the Office of National Statistics (ONS) also revealing that rental prices grew by 2.8% in England, 0.2% in Wales and 0.5% in Scotland.
Rental prices increased in all the English regions over the year to March 2016, with rental prices increasing the most in London at 3.7%.
Private rental prices in England show three distinct periods with rental price increases from January 2005 until February 2009, rental price decreases from July 2009 to February 2010, and increasing rental prices from May 2010 onwards. When London is excluded, England shows a similar pattern but with slower rental price increases from around the end of 2010.
In the 12 months to April 2016, private rental prices increased in each of the nine English regions, led by gains in London, followed by the East at 3% and the South East at 2.9%. Annual price increases have been stronger in London than the rest of England since November 2010.
The North East, North West, and Yorkshire and the Humber continue to record the lowest annual rental price increases.
According Paul Smith (pictured), CEO of haart estate agents, rental stock will start to decline as buy-to-let investors withdraw from the market following the introduction of the stamp duty surcharge, which in turn could place upward pressure on rental values moving forward.
He said: “Today’s data shows UK private housing rental prices increased 2.6% on the year as affordability issues in the sales market push up demand and therefore prices in the rental sector.
“While the number of properties available to rent surged following a rush from buy-to-let investors in advance of the stamp duty changes on the 1st April, we are now seeing a decline in stock as investors withdraw from the market.
“Ironically, the government’s efforts to help first-time buyers by penalising investors, could end up hindering them as a shortage of rental properties will drive up rents in the long term, making it more difficult to save up for a deposit.”