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Official Figures Show Highest Ever Annual Rent Increase in UK

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    Rents Increase by 9% According to the Latest Figures From ONS

    Official figures reveal a 9% rise in the average monthly rent paid by tenants in the UK in the year leading to February, marking the highest annual increase since records began in 2015.

    Let’s look at the national rental figures in more detail.

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      What Does the Rental Market Look Like Across the UK?

      The Office for National Statistics released figures on the 20th of March and shows that rental prices escalated across all regions of the UK.

      In England, average monthly rents surged 8.8% year-on-year, reaching £1,276.

      In Scotland, they increased by 10.9% to an average of £944; in Wales, they went up by 9% to £723.

      Data for Northern Ireland lags behind, with the ONS reporting a 9.3% rise there over the year to December 2023.

      Notably, the steepest rise in England occurred in London, already known for its high rents, with the average monthly cost for tenants escalating by 10.6% year-on-year to £2,035.

      Rental prices have been steadily climbing since the inception of the ONS series. Still, the pace of increase has accelerated recently, fueled by higher interest costs and a decline in the availability of rental properties.

      The figures for February represent the highest recorded since the ONS began publishing this index, which encompasses new and existing tenancies in England and Wales, newly advertised lets in Northern Ireland, and predominantly new lets in Scotland.

      For property investors, this means they may achieve higher gross yields than they would have during the same period last year. Tenant demand remains high, albeit not as high as it was through 2023, so this may be a good time to capitalise on the buy-to-let market’s conditions.

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      What Did Official Figures Say About Property Sales?

      HM Land Registry reported that average house prices dropped by 0.6% to around £282,000 in the 12 months leading to January, showing improvement from the 2.2% decline in the previous 12 months to December 2023.

      In January 2024, average house prices fell in England to £299,000 (-1.5%), in Wales to £213,000 (-0.8%), and in Scotland to £190,000 (+4.8%).

      Northern Ireland saw a 1.4% increase in average house prices to £178,000 in the year ending Quarter 4 2023.

      Between December 2023 and January 2024, average house prices rose by 0.5% without seasonal adjustment, compared to a 1.1% decrease during the same period a year earlier.

      North London estate agent and a former RICS residential chairman, Jeremy Leaf, says: “Lower inflation and the prospect of further falls has certainly fuelled housing market activity if not prices so far this year. These figures are particularly interesting as they cover not only mortgaged but cash sales, which alone account for over a third of the total, despite them being a little dated.

      “However, the increase in listings and back-of-the-mind worries about the economy has meant the market remains sensitive and only competitively-priced stock is attracting attention.”

      Learn more about the current state of the property market with our handy buy-to-let area guides, such as:

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      Dale Barham

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      Dale is a property content writer at RWinvest. Keeping a close eye on the UK property market, Dale helps our readers stay informed and up to date on the latest market news and statistics.