Rents across in England and Wales rose in all but two of the eight regions analysed in the year to February 2017, led by gains in Wales, the latest Your Move England & Wales Buy to Let Index has revealed.
Rents in Wales grew by an average of 7.7% in the last 12 months to reach £593 a month, although the principality remains one of the cheapest places to rent in this survey.
In fact, the North East, at an average of £545pcm, and Yorkshire and Humber - £566pcm - were the only regions with cheaper rents than Wales.
Other areas to see strong growth included the East and South East of England regions, where rents rose by 5.6% and 3.4% respectively.
The average rent in the East of England now stands at £868 a month, while the average rental property in the South East now rents for £878pcm.
“Areas in the South East and East of England have traditionally offered much better value than the capital and this has tempted many Londoners to look further afield for rental properties,” said Valerie Bannister, letting director at Your Move.
Rents in London continued to fall, and the city was the only region surveyed to see rents decline on both a monthly and yearly basis.
The average rental property in the capital let for £1,280pcm during February 2017, 1% lower than the same point a year ago. This figure was also 0.5% down on January’s total of £1,286pcm. However, the city still remains home to the country’s most expensive properties.
Bannister commented: “The dramatic rent increases in London have now slowed as people look outside the capital in order to meet their housing aspirations.”
“Renters in London could be reaching the limits of their affordability as prices dropped back 1% in the last year. This will be one to watch as the year progresses,” she added.
London was not the only area to see rents fall year-on-on year. In the South West prices went down 1.5% during the past 12 months to hit £662pcm, owed in part to a surplus supply of property for tenants in some southern areas.
Across the whole of England and Wales the average rent stood at £798 in February, the same as the previous month, but down sharply from the £811 recorded at the end of last year.
The typical yield in England and Wales was 4.1% in February, Your Move found. This is down on the 4.2% recorded a month ago and well below the 4.9% yield seen in February 2016.
Places with higher house prices continue to have the smallest yields, and so it is perhaps unsurprising to find that the average yield in London was just 3.2% last month – lower than any other part of the country.
At the other end of the scale, properties located in the North East enjoyed the biggest yields. In this region the average return was 5.3% last month, although this was marginally lower compared to the same period last year.