The buy-to-let market continues to see a marginal rise in residential rental prices, and this trend appears to be fuelled by a decline in the number of new properties coming on to the private rental market.
According to the latest HomeLet Rental Index, the average rent in the UK hit £912 per calendar month (pcm), up 0.9% compared with the corresponding period last year.
When London is excluded, the average UK rental value was £759pcm in March., which is up just 0.1% on last year.
Martin Totty, chief executive of Barbon Insurance Group, HomeLet’s parent company, said: “Rental price inflation was much more stable over the whole of 2017 compared to 2016, when rents rose at an annual rate of more than 4% in the first half of the year, before dropping back in the second half. So far, we are seeing this more stable market continue to prevail in 2018.”
He added: “During the first quarter of 2018, house prices across the UK rose by 2.7%, whilst the rental market increases have been nowhere near as significant, rising just 0.3%, showing much more stability, which has characterised the rental sector over a long period.”
On an annualised basis, rents rose in 10 of the 12 regions of the UK covered by the research, led by gains in Scotland where rents are up 5.6% year-on-year.
The North East of England was identified as the region with the largest month-on-month fall in rental prices, showing a 2.1% difference between February and March 2018.
Totty continued: “This data shows that a year into the three year phasing-in of changes to buy-to-let landlord taxation, rental inflation so far has remained steady rather than increasing as some commentators had predicted.”