Rent rise surge as rest of country outstrips London – high tenant demand, growing most in the East
– Tenant demand hotspots are Essex towns of Grays and Southend
– Within London highest demand in more affordable areas of Bexleyheath, Sidcup and Carshalton
Tenants looking for better value outside London have pushed asking rents of properties coming to market in the
South East (+4.1%) and South West (+3.0%) up this quarter, while London (+2.0%) rises at a slower pace. Outside of
London the average rent went up across England and Wales by 2.7%, with all regions up on last quarter except Wales
(-2.9%) and North East (-0.5%).
Sam Mitchell, Head of Lettings at Rightmove, comments:
“Rents have grown this quarter in nearly all regions of
England and Wales, fuelled by demand outstripping supply in many of the sought after areas, especially in the East
of England and the more affordable areas of London. The smaller rise in the capital is likely to do with the fact that
costs in many areas are nearing many people’s affordability ceiling.”
Average asking rents per month in London (£2,052) are now almost twice that of the second most expensive region,
the South East (£1,078). The capital is also almost four times more expensive than the cheapest region, the North East
(£534).
Rightmove’s first quarterly Rental Trends Tracker shows demand for rental property is at an all-time high, with demand
increasing most over the past year in the East of England (+64%).
While nationally rents have risen 4.2% over the past year, two of the highest growth areas are in the East of England
county of Hertfordshire – Bushey (+21%) and Stevenage (+13%). Deal in Kent has also seen a
price rise of 13% over the past year.
In London, rental prices have grown highest in Battersea, aided by the ongoing redevelopment of the area, up 14% over the past year. The North West areas of Wembley and Brondesbury are second and third, both up by 11%.
London’s demand hotspots all have average asking rents much lower than the capital’s average, with the top three being Bexleyheath (£1,048) and Sidcup (£1,073), both in South East London, and Carshalton (£1,095) in South West
London.
Mitchell notes:
“Tenants staying longer in a property is contributing to the lack of supply in some areas, and agents
tell us that in the most in-demand areas good properties on at the right price are being snapped up within a few days. In
the fastest moving areas prospective tenants are sending email enquiries to agents within a few minutes of the property
being marketed on Rightmove, showing that people need to get in quick and have all of their references ready to have
the chance of getting the property they want. The substantial rent rise this quarter will offer some encouragement for
the buy-to-let sector, following the summer Budget’s announcement of a clampdown on tax relief.”
Agent’s View
Zoe Rose, Head of London Lettings at Strutt & Parker, said:
“Rents are rising at a more subdued rate in the capital than
the rest of the country for a number of reasons. In Prime Central London, there is more stock becoming available than
last summer and rents are plateauing because tenants are very much in the driving seat. As people are also being
accustomed to renting for longer periods, a lot of tenants are signing up for two or three years from the outset with
rental increases of 3-5% per year written into their contracts. This keeps rental rises at a more sensible level as landlords
are being asked to commit to longer term tenancies. Over the past few years, it’s been an intense market in the centre
of London with rents in zone 1 and 2 gently creeping up prompting tenants to look further afield than traditional areas
like Clapham, Fulham and Battersea to get good value.”
