The average rent in England and Wales hit £850 a month in December, up 2.2% year-on-year, led by gains in the East of England, according to Your Move’s latest England & Wales Rental Tracker, previously named the Buy to Let Index.
Rents in the East of England, which contain many rural areas, commuter towns and major cities, including Cambridge and Norwich, outstripped all other regions in 2017, rising by 3.3% in the past month alone. The average rent in the region now stands at £893 per calendar month (pcm), up from £864pcm in the corresponding month in 2016.
Reflecting on the new data, Sue Maher, branch manager of Your Move in Peterborough, said: “We are seeing a large shift in commuting patterns as tenants look to relocate away from London, to towns like Peterborough and Norwich who are attracting a wide range of employers.
“The City Hospital in Peterborough, for example, attracts many doctors and nurses to the area and local business parks house the offices of Travelex, Thomas Cook, Mastercard and Amazon to name a few.
“As a result, these areas are predominately rented by young working professionals and families, rather than students or older residents.”
Other areas posting strong price increases were the East Midlands, where rents grew by 2.8% to reach an average of £651pcm and the North West, which saw 2.7% year-on-year growth to reach an average of £635pcm.
In both London and the North East rents have dipped in the last 12 months.
The yields achieved by buy-to-let investors remained unchanged in December, with the typical yield across England and Wales stood at 4.4%, the Your Move data found.
Martyn Alderton, national lettings director at Your Move and Reeds Rains, said: “The rental market in England and Wales ended 2017 on a positive note for landlords, with rents, overall, up 2.3% compared to a year ago, and average yields across the country now at 4.4%.
“However, behind these figures lie fluctuations particularly in relation to the fall in average rents in London and strong growth in average rents in other regions.”
Buy-to-let investors in the North East of England continue to enjoy the highest return at an average of 5%.
At the other end of the scale, properties in London delivered the lowest yield, at just 3.2% in December.
Alderton added: “In many ways, the rebalancing of the rental market across the country should be seen as a good thing as demand spreads to other areas and keeps the market robust.
“London still remains one of the most popular and expensive places to rent, yet we are now seeing strong growth in demand for rental properties in the regions around the capital.”