A survey conducted for buy to let lender Landbay claims that a strong lettings market even in winter demonstrates “the shortage in properties to rent as large parts of the UK face an acute housing shortage.”
Landbay’s latest index shows that average monthly rents ended 2015 with a slight seasonal dip of -0.2 per cent from £1,289 in November to £1,286 in December. This means that full-year average rents for the UK in 2015 were £1,280, up 3.8 per cent on the previous year.
The data shows that rents in the UK grew twice as fast as wages, which climbed 1.9 per cent in 2015.
Landbay contends that in the East of England, stagnant wage growth of 0.1 per cent combined with rapid rent rises meant that rental growth outpaced wage growth by over five per cent. The North East and North West were the only regions to see wages outpace rental increases.
Compared to 2014, three bedroom properties have seen the biggest increase in the average rental price, up 5.2% to £1,484 in 2015 suggesting that family homes and properties for sharers are in highest demand. (Table 1: Changes in average annual rental prices by number of bedrooms)
Commuter hotspots surrounding London were amongst the country’s top risers in rental prices. Luton (11.1 per cent), Medway (8.8 per cent) and Thurrock (7.3 per cent) feature in the top five for rent price increases during 2015 - a sign, claims Landbay, that many working in the capital are priced out from living there.