Latest figures show the UK’s average private rent increased by 9.0%
Over recent years, the rental property market has witnessed a significant surge in demand, with supply struggling to keep pace. This imbalance between the number of available rental homes and the burgeoning pool of renters underscores the pressing need for an increase in long-term rental properties.
According to the latest figures from the Office for National Statistics (ONS), the UK saw an average private rent increase of 9.0% in the year leading up to February 2024, marking a notable rise from the preceding year.
Regional insights
In England, the scenario is particularly pronounced, with the average private rent reaching £1,276 in February 2024, which represents an 8.8% increase from the previous year. This is the most substantial annual growth observed since the commencement of this data series in 2006, evidencing a slight uptick from an 8.3% increase noted in January 2024.
Welsh rental market
Turning our attention to Wales, the average private rent was recorded at £723 in February 2024, climbing by 9.0% from the year before. Despite this growth, there has been a slight deceleration from the 9.1% rise reported in the year to January 2024. This marks the third consecutive month of slowed annual inflation, a dip from the record-high annual increase of 9.8% observed in November 2023.
Scotland’s rental dynamics
Scotland’s rental market tells a similar tale, with average rents ascending to £944 in February 2024, up by 10.9% compared to the previous year. Although this reflects a minor decrease from an 11.2% annual increase in January 2024, it remains a significant figure, especially when considering the gradual slowing of Scotland’s annual inflation rate since the record-high annual rise of 11.8% in August 2023.
The pattern of rising annual inflation observed between late 2021 and mid-2023, followed by a slight moderation, likely mirrors recent shifts in annual inflation rates for new lettings, which are not subject to price caps. It’s important to note that due to data collection constraints, the statistics for Scotland primarily pertain to advertised new lets, exempt from the country’s in-tenancy price-increase cap under the Cost of Living (Tenant Protection) Bill.
Northern Ireland’s rental market
Focusing on Northern Ireland, where data is available up until December 2023, we observed a 9.3% increase in average private rent over the 12 months to December 2023. Although this represents a slight decrease from the 9.5% rise in November 2023, it is considerably lower than the record-high annual increase of 10.0% in March 2023.
Unparalleled freedom and flexibility
In the current property market landscape, renting can be a pragmatic choice for many individuals. Beyond the appeal of lower upfront costs, renting offers tenants unparalleled freedom and flexibility, enabling them to select homes that perfectly align with their lifestyle preferences.
Looking for a buy-to-let mortgage for your investment property?
If you’re buying a property as an investment, it’s important to understand your mortgage funding options that are right for you. To find out how we can help, speak to our team.
Please note: this is a long term investment which you hope will generate rental income along the way and a profit when you sell the property, but bear in mind that if you need access to some cash, a property can take time to sell or remortgage. If house prices fall, you might not be able to sell for as much as you had hoped. You would have to make up the difference if the property sold for less than you owe – a risk that increases, the higher the percentage you borrow. If you sell for a profit, you may have to pay capital gains tax. Don’t forget that with a variable rate mortgage, your costs will rise if interest rates go up. This would eat into, or even wipe out, your income and profit. It is recommended that you also maintain access to emergency funds to cover your mortgage payments during ‘void periods’ that may arise whilst you have no tenant and the property is not let. Please also note: a mortgage is secured against your home or property. Your home or property may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
