Overall across the UK, advertised rents increased by £66 per month in a yearly comparison to reach £1,034 per month, the data from Move With Us shows.
In the South East and East Anglia they reached the highest recorded levels in at £1,254 and £947 per month, increasing by £18 and £11 each month respectively and Scotland also continued to be a strong performing region, with average rents hitting record levels of £727 per month.
The firm said that, as with the second quarter of the year, the average national rent has been significantly influenced by a burgeoning London market. The average advertised rent in London increased by £118 in the quarter to reach £2,452 per month, some £230 higher than it was during the same period in 2013.
In northern regions of England, however, rents have fallen gradually across the board with Yorkshire and Humber seeing price reductions of over £20 per month.
‘There is a stark contrast between the South and North of England as the divide between the cost of renting increases,’ said Robin King, director of Move With Us.
For example, in Yorkshire and Humber the average rent is only £4 per month higher in a yearly comparison but in the South East this figure is significantly higher at £112 per month. North of the border, in Scotland, landlords have benefited from a significant rise in the average advertised rental price.
‘Annual growth is always good news for landlords but those in regions where we are not seeing huge amounts of growth shouldn’t be too concerned as we approach the end of the year. January is likely to bring a new influx of potential renters to the market who are looking to move in the New Year,’ he added.
A regional breakdown shows that the average rental price in London is more expensive than in the summer high of 2012 when the London Olympics artificially inflated asking rents. Rents are continuing on an upward trajectory which is likely to continue into 2015. The quarter ended with the average advertised rent at £2,452 per month.
Average rents in the South West have grown steadily throughout 2014, however, rents have fluctuated week to week while never falling below an average of £800 per month. In the third quarter the market improved marginally in July before dipping £3 or 0.4% in August and September.
The average advertised rent is the region is £33 or 4.28% up in a yearly comparison at £813 per month. While the average rent seems set to continue to grow over the next year, it’s likely that minor fluctuations will persist, according to the index report.
The South East is the strongest performing region outside of London and the average advertised rents have grown steadily over the past two years. In the last year, rents have risen by £112 per month, equivalent to a 10.11% increase since 2012.
Also, the £18 increase in monthly advertised rents over the third quarter of 2014 is the biggest regional growth outside of London for the period, and reflects the continued improvement to an already strong market. The average price to rent in the South East now stands at £1,254 per month and looks set to continue to grow, albeit at a slower pace.
After rising steadily throughout the second quarter of 2014, the average advertised rent in East Anglia reached a record high of £948 per month and stayed around this level for the rest of the third quarter. Advertised rents are holding fast after a period of successive rises, demonstrating the strength of the market in East Anglia, one of the best performing regions in Britain.
Average advertised rents were at their highest at the end of 2013, through to the first two months of 2014. Since then the market experienced a period of gradual decline but more recently it seems to have bucked this downward trend. Despite rents only increasing by £7 or 1.18% in the third quarter they are £26 higher in a yearly comparison. At the end of September they were £642 per month.
Following a period of sustained growth in the first half of 2014, average rents in the West Midlands have begun to decline having fallen by £11 or 1.7% per month in the third quarter. The report says that this sort of adjustment is expected after a period of growth as the market adjusts to find its equilibrium.
As the third quarter came to a close, the advertised rent in the area was £681 per month and the data also shows that average rents in the West Midlands have increased by £26 or 4% in a yearly comparison. This demonstrates that despite the quarterly decline in advertised asking rents, the market in this region is ultimately growing, the report points out.
The rental market in Yorkshire and Humber declined in the second half of 2014. Advertised rents rose to £640 per month in the first quarter of the year but have since fallen below £600 per month to settle at an average of £593 per month, some £21 or 3.76% down when compared to the second quarter.
The current asking rent in Yorkshire and Humber is only £4 higher in a yearly comparison, indicating that rents may settle back into their natural price range of £560 to £580 per month, where the market was in 2012.
The North West is in a period of decline, having shown signs of recovery during July before trailing off by £15 per month in August and September. The average advertised rent now stands at £610 per month.
Advertised rents are approximately £8 down in the third quarter of 2014 in a yearly comparison but have dropped around £30 per month from the beginning of the year. The market may return to 2012 levels when the average advertised rent in the region was just below £600 per month.
The quarterly dip in advertised rents in the North East of just £3 per month or 0.46% is marginal and should be viewed as part of an ongoing trend of fluctuation, according to the report.
Likewise, rents in the third quarter of 2014 in this region are slightly down on those of 2013 having dropped by £4 per month. Price fluctuations seem set to remain within the accepted limits, a sign of a balanced marketplace. A stable market average of between £640 and £660 per month seems to be the market’s natural position.
Average advertised rents in Scotland have grown significantly throughout 2014, so much so that rents peaked at a record high of £739 per month at the beginning of September before dropping slightly to a quarterly average of £727 per month.
While average rents have fallen from the second quarter 2014 by £7 or 1.08%, the market has grown by £67 in a yearly comparison and it is now on average £100 more expensive to rent a property in Scotland than it was at the end of 2013.
The average rent in in Wales in the third quarter was £658 per month, having dropped marginally by £2 or 0.39% over the last three months. Such minor changes to the average advertised rent have characterised 2014 for Wales and this stability looks set to continue to the New Year, the report says. The average advertised rent has stabilised throughout 2014 and the market has found its equilibrium around the £660 per month mark.
