0:01 AM, 18th January 2024, About 11 months ago 3
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Tenants in the UK are feeling the pinch as private rent prices reached record highs in the year to December 2023, the Office for National Statistics (ONS) reveals.
The ONS reports that rents rose by 6.2% last year, unchanged from the annual rise seen in November.
The increase was driven by strong demand and a limited supply of rental properties.
London, Wales and Scotland saw the highest annual percentage changes in rents at 6.8%, 7.1% and 6.3% respectively.
The figures back up what Hamptons have revealed this week – that rent rises last year set new records.
A spokesperson from the ONS said: “Private rental prices have been rising steadily across the UK since the second half of 2021.
“Private rental prices in London account for almost a third of UK rental expenditure, so changes in the capital have a significant effect on the overall UK figure.”
London’s rents rebounded from a decline in 2021, as more people returned to the capital after the easing of lockdown restrictions.
Wales and Scotland experienced the highest annual rates of increase since the ONS began collecting data in 2006 and 2012 respectively.
Renters in the North East of England had the lowest annual percentage change in rent at 4.6%, but still above the average inflation rate of 3.8%.
The ONS data also showed that rents excluding London increased by 5.8%, slightly lower than the increase of 5.9% in the year to November 2023.
When London is excluded from England, rents increased by 5.7%, the joint-highest annual percentage change since the data series began in 2006.
Private rents in Northern Ireland rose by 9.3% in the year to October with rent increases slowing since the peak of 10% in March 2023, but remains higher than for other UK countries.
Anna Clare Harper, the chief executive of GreenResi, said that while average rents rose by 6.2% in the year to December 2023, it might not look like much to observers.
She says: “With inflation of 4%, however, this statistic underestimates the reality faced by renters.
“For the one in four renters who move each year, rental price increases are often twice as high.”
She adds: “This is a huge problem: financial security is very difficult to achieve in a context of double-digit price rises for the largest household expense.
“Worse still, affordability is just one of the problems facing Generation Rent.
“There are not enough homes – rental supply is down 28% in the past 18 months.”
Jeremy Leaf, a north London estate agent and a former RICS residential chairman, said: “For aspiring first-time buyers the sad news is that average rents are still rising, making deposit saving even more difficult, and it’s also making life harder for longer-term tenants too.
“The usual suspects are at work here – shortage of stock, partly caused by landlords leaving the sector in response to worries over the tax and regulatory regime, while at the same time demand seems unstoppable.”
He added: “However, in the early weeks of 2024, we have noticed an increase in supply which has helped to keep a lid on some of the more ambitious rents and the gap with demand is narrowing.”
JB
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Sign Up11:37 AM, 18th January 2024, About 11 months ago
'The increase was driven by strong demand and a limited supply of rental properties'
More likely driven by an increase in all costs especially mortgages.
Rents will keep going up as landlords play catch up from interest rate rises which occurred when they couldn't increase rents as they were locked into a contract
JeggNegg
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Sign Up11:58 AM, 18th January 2024, About 11 months ago
i am struggling to understand the point you are making here, as property rent increases was not alone!
my energy bills are much higher than 6.2%,
my weekly food shopping is also much higher than 6.2%
etc . etc.
in fact with a shortage of rental properties and an increase in demand i am surprised the increase was not even higher.
i totally accept there is a major problem with a massive shortage of good quality housing stock in UK.
so what can we do to change that?
we have to accept that the Politicians have failed us in meeting their target of 300,000 'new homes or houses' what ever that actually means.
i believe it will be down to landlords and renters and financial advisors to work together and come up with a long term recommendation/package/plan, to kick start and manage the homeless issue rather than leaving it to politicians.
JeggNegg
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Sign Up12:10 PM, 18th January 2024, About 11 months ago
maybe the Treasury could help? or the chancellor in his next Budget ease some of the restrictions for private Pension Plans and allow a percentage of each private fund to invest in developing and remaining invested in the rental sector? or even raise a pot of money in a new property bond ( similar to the premium bond). pension and properties are both long term investments and it might work.