Rents rise well below inflation, new figures show

Rent increases in the third quarter of 2019, as released by The Deposit Protection Service (The DPS) Rent Index, reveal growth significantly below the level of inflation.

According to the data from The DPS, one of three government-backed deposit protection schemes, average UK rents rose between July and September by £7, or 0.91%, to £778 per calendar month (pcm), failing to keep pace with inflation of 1.9% during the period. 

Average rents rose across most of the UK, with regions outside London averaging £676pcm, which is a marginal uplift of £3, or 0.5%, on Q2 2019. 

Yorkshire and The Humber saw the largest increase of £19, or 3.6%, to £552pcm since the previous quarter. 

The East Midlands and West Midlands experienced the only falls in England during Q3 2019: down £13, or -2.17, to £578pcm and £1, or -0.19%, to £620pcm, respectively.

The North East was the cheapest place in the UK to rent property at £526pcm during Q3 2019 with a modest £3, or 0.65% increase, during the period.

“Average rents in the third quarter of 2019 did not keep up with inflation, as they did in Q2 2019. This suggests rental values in the UK are regulating themselves against inflation,” said Matt Trevett, managing director of The DPS.

Looking at the figures on an annual basis, terraced and semi-detached properties in Q3 2019 experienced above-inflation growth of more than 4% in average rent rises when compared with Q3 2018, while rent increases for flats and detached properties were below inflation, at 1.36% and 0.8% respectively, during the corresponding period. 

London unsurprisingly remains the most expensive rental region in the UK, with the largest year-on-year growth of £43, or 3.34%, and an average rent of £1,333pcm.

Scotland and Wales are the only regions to experience year-on-year as well as quarter-on-quarter rent decreases, with Scotland’s rents falling by £6, or -1.02%, to £619pcm, while Wales saw rents drop by £8, or -1.43%, to £578pcm. 

On average, people in the UK spend 32% of their wages on rent, according to The DPS.

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