Asking rents in Britain are now rising at their fastest ever rate according to Rightmove.
Average asking rents hit annual growth of 9.9 per cent to reach £1,068 per calendar month outside of London, the highest annual jump on record, and recovering strongly from the slowdown in rental growth in the months immediately after the pandemic started.
London is recovering too.
While at the end of 2020, all-London recorded a near-record 6.4 per cent drop in average asking rents - as the race for space outside the capital gathered momentum - the early 2022 figure showing 10 per cent growth paints a very different picture.
This is particularly the case for Inner London where rents grew at a record 16.2 per cent last year, recovering from its drop of 14 per cent at the beginning of 2021, to also rise just ahead of pre-pandemic levels for the first time.
Across Britain the rapid growth in average asking rents, driven by high tenant demand and low numbers of rental properties available, means that rising rents are outpacing house price increases in all but three regions - the East Midlands, South West and South East.
Wales (where rents rose 12.7 per cent in the past year), leads the way in annual asking rent growth, with Pontypool in Monmouthshire seeing the largest annual increase in asking rent of any local area, jumping 20 per cent from £562 pcm to £674 pcm.
The imbalance between high tenant demand and low rental stock is supporting asking rent rises and has led to competition between tenants for the rental properties available nearly doubling compared to the same period last year.
Total rental demand is up by 32 per cent compared to this time last year, while the number of available rental properties is 51 per cent lower. This has led to available rental properties being snapped up by tenants in just over two weeks on average.
However, the number of available rental properties is seven per cent higher than the same period in December, and Rightmove regards this as a sign of availability improving at the start of the year.
Rightmove’s director of property data, Tim Bannister, says: “Asking rents have finally risen beyond pre-pandemic levels, a sign that the capital has not lost its pull and popularity with renters as landlords look to renegotiate previous cut-price terms.
“Tenant demand continues to be really high entering the new year, meaning the imbalance between supply and demand is set to continue until more choice comes onto the market for tenants, which has led to our prediction of a further five per cent increase in average asking rents in 2022.
“Landlords understand the importance of having a good, long-term tenant, and there is a limit to what renters can afford to pay, which will prevent rents rising at the same rate we’ve seen over the past year.”