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Friday, April 12, 2019

Average UK rent down again

Average UK rent down again in Q1 2019; imminent tenancy fees ban may be slowing house moves, says The DPS.

Average monthly UK rent is now at its lowest level for three years (since Q1 2016), according to a quarterly report by The Deposit Protection Service (The DPS).

Rent fell to £757 during the first quarter of 2019, with tenants paying £5 (0.64%) less than the previous quarter (Q4 2018) and over £14 (1.87%) lower than a year earlier (Q1 2018), according to latest edition of The DPS Rent Index.

The decrease continues the overall downward trend seen in the first three quarters of 2018, and The DPS says that it may be in part driven by a reluctance among tenants to move until after the Government’s Tenant Fees Ban comes into force on 1 June.

Daren King, Head of Tenancy Deposit Protection at The DPS, said: 

“The depressed market for rents is part of the larger slowdown that began during the summer of 2016 and which we believe is linked to broad economic factors affecting spending power and demand in the UK.

We also believe that the rental market may be experiencing a period of tenant inactivity driven by uncertainty ahead of the imminent enforcement of the ban on tenancy fees.

Even after a long period of stagnation, we don’t see many signs of a recovery anytime soon and it is possible there will be more quarters of low or negative growth this year.”

Of the UK regions, only the South West, East Midlands, Yorkshire and the Humber and Wales experienced increases in average rent, although all were minimal, with the South West seeing the biggest (0.63%).

London remains by far the most expensive region in which to rent property. The capital has seen consistent average rents over the past three quarters, following a sharper drop in the first half of 2018.

The North East remains the cheapest region in which to rent property with an average of £513 during Q1 2019: just over £244 lower than the national average.

Terraced and semi-detached houses as well as flats all saw a fall in average rents in Q1 2019, although detached homes saw a marginal increase of £3 or 0.34%.

On average, the UK population spent 31% of their wages on rent in Q1 2019. The proportion is highest in London (41%), and lowest in Northern Ireland, Yorkshire and the Humber, and the North East (24%).

2018 was the first calendar year since the global financial crisis of 2008 that average rents decreased in the UK.

For the full report, see:
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