Rents outside of London soar to an average of £1,190 a month as tenants compete for a lack of homes to let
- Rents rose by 9.4% over the past year even as supply increased
- In London the average rent surpassed £2,500 for the first time
Rents outside of London have reached a record high of £1,190 a month according to latest data from Rightmove.
Rental costs have now risen outside of the capital for 13 consecutive months as supply remains constrained despite signs of improvement.
The rate of rental growth outside of London has been slowing slightly for the past three quarters.
Monthly costs increased 9.4 per cent over the past year, down from 9.7 per cent annual growth in the last quarter of 2022.
Rents rose by an average of £100 a month in Britain over the past year
The increase adds around £100 to the average renter’s monthly cost, costing them an additional £1,2000 a year.
A large reason for this is demand is up 48 per cent from 2019, while the number of properties available has fallen by 46 per cent over the same period.
The number of available properties to rent is now 6 per cent higher than last year, but at the same time demand has risen 4 per cent.
In London, average asking rents surpassed £2,500 for the first time to reach a new record of £2,501 a month. There are signs that the speed of rent rises is slowing in the capital too, as this quarter’s rise of 0.9 per cent is the smallest for two years.
Tim Bannister, of Rightmove, said: ‘We have seen some early signs of improvement on squeezed supply levels this year, though with no significant influx of new properties becoming available to rent currently on the horizon, the mismatch is set to continue for some time.
‘Many agents are having to manage a very high volume of tenant enquiries for every property that they let in the current market.
‘Properties in popular areas within an affordable asking rent range of that local area are likely to be snapped up almost immediately, and on average homes are finding a tenant much more quickly than this time in 2019.
‘Although there are some early signs that the gap between supply and demand is starting to narrow a little, it will still feel very competitive for tenants trying to secure a home.’
There are just five pockets of Britain where asking rents for tenants have dropped over the past year, exclusive data for This is Money shows.
Rents have risen across the country for 13 consecutive months although the rate of price growth is now slowing
Burnley, Lancashire, saw the biggest fall in asking rents with prices dropping 7 per cent on average, to £620 per month.
In contrast High Wycombe in Buckinghamshire was rents rise 22.4 per cent over the past year adding £240 a month to the average rent in the area.
Tenants in Farnham, Surrey saw their rents rise by 21.9 per cent over the year to £1,491 a month.
What to do if you need a mortgage
Borrowers who need to find a mortgage because their current fixed rate deal is coming to an end, or because they have agreed a house purchase, should explore their options as soon as possible.
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What if I need to remortgage?
Borrowers should compare rates and speak to a mortgage broker and be prepared to act to secure a rate.
Anyone with a fixed rate deal ending within the next six to nine months, should look into how much it would cost them to remortgage now – and consider locking into a new deal.
Most mortgage deals allow fees to be added the loan and they are then only charged when it is taken out. By doing this, borrowers can secure a rate without paying expensive arrangement fees.
What if I am buying a home?
Those with home purchases agreed should also aim to secure rates as soon as possible, so they know exactly what their monthly payments will be.
Home buyers should beware overstretching themselves and be prepared for the possibility that house prices may fall from their current high levels, due to higher mortgage rates limiting people’s borrowing ability.
How to compare mortgage costs
The best way to compare mortgage costs and find the right deal for you is to speak to a good broker.
You can use our best mortgage rates calculator to show deals matching your home value, mortgage size, term and fixed rate needs.
Be aware that rates can change quickly, however, and so the advice is that if you need a mortgage to compare rates and then speak to a broker as soon as possible, so they can help you find the right mortgage for you.
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