Rents down 8.3% in London but up 2.3% outside the capital

Hometrack have released their Q4 2020 Monthly Rental Market Report; click here

The report confirmed average rents across the UK excluding London rose by 1.4% in the three months to the end of December, taking the annual growth in rents to 2.3%. However, average rents in London are down -8.3% with rental decreases concentrated in the inner city

Overall for the whole UK annual in rents decreased -1.2% with the average time to let a property at 15 days and the UK average monthly rental income standing at £920

Across the UK demand for rental property is still rising, with total demand from renters in January 21% higher than the same month last year. At the same time, the supply of homes to let fell by 11% over the same period putting upward pressure on rents in many areas.

“The pandemic has disrupted some of the key drivers of demand in the rental market – including labour mobility, migration and employment growth. Despite this, we have seen a rise in localised demand in some areas, as some renters look to relocate.

“The outlook for the rental market, especially in central cities, will depend on how quickly the COVID-19 vaccine is rolled out, and how quickly it can start to have an effect and kick-start a return to more mobility across the country, and internationally.

“As this happens, ‘business as usual’ will start to resume in city centres as business activity starts to rise, from the reopening of retail and offices to events spaces, leisure and entertainment facilities. This will likely result in tick-up in demand in city centres, as well as a shift from long-term lets back to short-term lets in some cases, helping to absorb some rental stock, particularly in London.

“Flexible working is likely to continue, meaning there may be a permanent shift in priorities for some renters in terms of location and property type. The ‘search for space’ will likely continue, supporting the rental market for family houses.”