Property expert outlines the UK hotspots on the housing market
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According to property website Zoopla’s quarterly Rental Market Report released this week, the cost of rent across the UK is rising at its fastest pace since 2008. The news has added to concerns over “generation rent”, and whether young professionals in cities will ever be able to afford to get on the property ladder.
According to the report, “demand continues to outstrip supply”, which is running at 43 percent below the five-year average, leading to a knock-on effect on rents.
The research showed private sector rents in the UK were 4.6 percent higher in September than a year before at £968 per month on average – the strongest growth seen in 13 years.
Outside of London, rents were up by six percent, marking a 14-year high, it said.
After 15 months of consecutive falls, London’s rents have swung back up, rising 4.7 percent between June and September this year.
The research showed the capital saw prices increase by 1.6 percent annually, compared with falls of nearly 10 percent around the start of the year, making the average rent per calendar month in London some £1,592.
The biggest climbers:
South West – up 9.0 percent to an average rent of £860 pcm
Bristol – up 8.4 percent to an average rent of £1,116 pcm
Nottingham – up 8.3 percent to an average rent of £1,116 pcm
Wales – up 7.7 percent to an average rent of £660 pcm
Glasgow – up 7.2 percent to an average rent of £710 pcm
Cardiff – up 7.0 percent to an average rent of £869 pcm
Sheffield – up 6.3 percent to an average rent of £665 pcm
West Midlands – up 6.2 percent to an average rent of £716 pcm
Liverpool up 6.1 percent to an average rent of £650 pcm
Newcastle up 6.1 percent to an average rent of £638 pcm
The uptick is due to “offices reopening and city life resuming”, Zoopla said, seeing people flock back to cities as pandemic restrictions wind down and driving up demand.
Zoopla said demand for rented properties is still outstripping supply, putting upward pressure on prices.
In addition to this, Zoopla said, was the compounding factor of “long-term structural issues such as landlord divestment following the three percent stamp duty levy introduced in 2016”.
Grainne Gilmore, head of research at Zoopla, told Express.co.uk the popularity of homes in higher price bands was also contributing.
She said: “Households looking for the flexibility of rental accommodation, especially students and city workers, are back in the market after consecutive lockdowns affected demand levels in major cities.
“Meanwhile, just as in the sales market, there is still a cohort of renters looking for properties offering more space, or a more rural or coastal location.”
Generally, though, she said the “swing back of demand into city centres, including London, has underpinned another rise in rents in Q3, especially as the supply of rental property remains tight”.
And rents are expected to continue climbing into 2022.
Current forecasts show rents are expected to rise yet another 4.5 percent by the end of next year.
Dan Wilson Craw, Deputy Director of campaign group Generation Rent, said the new report was “terrible news” for anyone trying to move right now.
He said: “We have been hearing from renters who have lost bidding wars for homes, or failed affordability checks, so are being priced out of their areas.”
He added that since the pandemic, private renters were more likely to be getting housing support through the welfare system.
He added: “But the chancellor has frozen rates for another year, so these rises will make it even harder to find an affordable home.
“The Government has to do much more to bring rents down – that means building more homes, including social housing.”
At last month’s Budget, Chancellor Rishi Sunak announced almost £2bn would be invested by the government into building new homes on derelict or unused land in England.
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