Rents outside London soaring at fastest rate on record, agencies say

Rents outside London soaring at fastest rate on record, agencies say

Private rents outside London are rising at their fastest rate for 13 years, research suggests, as tenants making plans for life post-pandemic compete for properties.

The property website Zoopla said average rents across the UK outside the capital rose by 5% over the 12 months to the end of July – adding more than £450 to a typical annual rent bill – the biggest increase since its index began in 2008.

However, locations popular with tenants quitting London and other big cities after reevaluating their lifestyle have seen rents jump by a lot more – up to 25%, according to some estate agents.

Rents in Wigan, Greater Manchester, and Mansfield, Nottinghamshire, have risen by upwards of 10% in a year, while in Hastings, East Sussex, and Norwich rents are up by more than 9%.

Kate Eales, the head of regional residential agency at Strutt & Parker, said: “Rents are recording healthy growth in cities, but in the most desirable areas, there’s evidence of growth of up to 25%. We recently let a home in the Cotswolds for £3,750 per calendar month when it was previously let out at £2,200, and another was let for £5,500, up from £4,100.”

Average rents for the UK, excluding London, are running at £790 a month, up from £752 a year earlier, meaning renters are paying an average of £456 more a year.

Zoopla said there had been “a sharp rise” in demand for city living, though its data showed that rents were still down in London on an annual basis, in the wake of many tenants leaving the capital for a new life in the suburbs or the countryside.

However, the website said rental declines in London had “bottomed out” as demand rebuilt after the reopening of offices and amenities. On an annual basis, average rents in London were down by 3.8% in July, compared with almost 10% in February this year.

A combination of soaring demand and a shrinking supply of available properties is one of the main factors putting upwards pressure on rents. In the wake of booming house prices, some landlords have sold up, while others who previously let their properties to traditional tenants have turned them into holiday lets. Summer and early autumn is also a typically busy period for the rental market, as students start university, graduates start new jobs and families relocate for schools.

Eales said properties were also being snapped up by would-be homebuyers who were “renting tactically” so they could move quickly when their perfect property came on the market. This trend was “particularly prevalent among London leavers”, she added.

Gráinne Gilmore, Zoopla’s head of research, said: “The strong levels of rental demand seen across the UK … will moderate in line with seasonal trends, but overall demand for rental property is likely to remain higher than usual in the coming months amid this swing back to city life.”