UK rental market trends differ depending on the area and the type of property. In trendy regions for escaping Londoners, house rent prices rose to 20% during the Q2 already and are not getting any lower by the end of the year.
Zoopla data shows +2.1% of annual change in rents (UK average). The UK average monthly rent is now £943.
- In cities, there is a surge in demand for rental properties;
- The imbalance between rental demand and supply has pushed rental growth to the highest level since 2008 everywhere across the UK except London;
- Rental growth outside London by the end of August was at +5.0%, up from +2.2% in January
- London rental declines have bottomed out amid rising demand, reaching -3.8% in July, from -9.8% in February. The prime sector is an exception; rents stay very much put there.
- Rental growth returned to Leeds, Manchester and Edinburgh, after a bad start in winter;
- The market is moving at the fastest rate since 2016, with average Time to Rent at 15 days across the UK
Savills UK noted that prime London rental prices record the strongest quarter since March 2011, driven by a return to the office and the reopening of international travel.
From the investor’s view, houses outperform flats from a rental and price perspective this autumn, and this will continue. But the prime London part of the market shows the reverse: quarterly rental values for flats are 0.7% higher than for houses.
The stock of prime flats to rent in the premium sector is short. You can check private rents rates in different London areas using an interactive tool provided by the Greater London Authority.
Despite the effects of the pandemic on the real estate markets, the private rented sector very much survived, meaning that buy-to-let remains a good investment into the future. Knight Frank data reveal that during this year, the inbound flow of UK private equity residential property investment accounted for USD 4.1bn, while the outbound was only USD 0.9bn.
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