The average rent for a property in England increased by 0.64% in the year to April, as falling rents in London continued to weigh down on otherwise resilient letting market.
If the fall of 0.27% in rents in London is taken out of the calculation then overall rents grew by 1.19% in the rest of England, according to the latest Landbay rental index.
The top growth over the last 12 month was in Leicester where rents increased by 3.02%, followed by Nottingham, up 2.96% and Northamptonshire 2.44%, the data shows.
Indeed, eight of the top 10 regional for growth were either in the East Midlands or the East of England. The two regions, as well as the South West, continue to lead the way in terms of rental growth, with annual increases of 2.06%, 1.50%, and 1.54% respectively.
But in London 17 out of 33 boroughs have seen rents fall. Kensington and Chelsea has seen the biggest fall at 1.4%, the largest overall, followed Kingston upon Thames down 0.98%, Hammersmith and Fulham down 0.81%, and Tower Hamlets down 0.79%.
Barnet recorded a fall of 0.69% and Harrow was down 0.68%. Just six boroughs saw growth ahead of the 0.64% average in England. The top growth was in Bexley, Havering and the City of London, with rents up by 1.37%, 1.3% and 1.19% respectively.
The average rent paid for a property in England now stands at £1,232, or £768 if you exclude London. The lowest average rent is found in the North East at £552, where rents have shown very modest long term growth over the past five years, increasing by just 1.8% during this time. Despite a year on year increase of 0.26%, rents in the North East have been falling since the start of 2018.
‘Falling rents in some parts of the country, especially expensive prime London locations, distort the picture for the rest of England where rents are continuing to grow at a steady pace. Britain will always need homes, and the growing cohort of people that can’t buy, or don’t want to, will more than ever rely on the private rental sector to house them in the years ahead,’ said John Goodall, chief executive officer of Landbay.
‘Rental growth may not be what it used to be, but the pace of change varies wildly between regions. Prospective landlords need to be astute to maximise their profits, using variations in rental growth and yields over the past year to pick out some of the most promising regions for buy to let. Consistent rental demand will obviously drive returns in the long-term, but by selecting the right location yields will be even greater,’ he added.
