Hamptons’ Lettings Index reveals that while the South experienced a cooling in rental growth from 8.7% to 5% over the last year, the North has seen rents rise by 9.6% year-on-year, maintaining a similar pace to the previous year.
As a result, Hamptons says the gap between rents in the North and South has closed to its smallest level since they began their records in 2013. Last month, the average new tenancy in the South of England cost £1,318 PCM, 37% more than in the North, where rents averaged around £960 PCM. This gap has narrowed from 43% in August 2023 and down from a peak of 55% in November 2021.
Data also suggests that the North-South divide has fallen in cash terms. For example, the average rental property in the North cost £357 PCM more than in the South, down from £378 PCM in August 2023.
Hamptons believes that this narrowing reflects the cyclical nature of the housing market, with house prices in the North rising 31% – nearly double the rate seen in the South. Their data suggests that these figures have been mirrored in the rental market, with rents in the North quickly catching up.
In real terms, rents in the North have increased by 24%, compared to 10% across the South of England. Rents in Wales (-5%) have fallen in real terms over the last 5 years.
Rents in Greater London are only slightly positive, with just 3% rental growth since 2019, equating to an average of just 0.2% growth each year in the capital.
