Tight supply increases rents across most regions during Q4 2021

Tight supply increases rents across most regions during Q4 2021

10:55 AM, 19th January 2022, About 4 months ago

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Average UK rents have increased for the fifth consecutive quarter as pressure on the supply of rental homes continues during the pandemic, according to The Deposit Protection Service (The DPS) – amid reports that some renters are willing to pay upfront rents or over the odds to secure properties.

The PDS report:

Rents across the UK increased by 5.30% (£42) between Q3 2020 and Q4 2021, with London, the South West and Yorkshire seeing the largest value rises during Q4 2021

Average rents have increased across all property types during Q4 2021, with rents on detached homes increasing 8.34% (£88) since Q3 2020

Rents in York increased by almost 10% (£71) during Q4 2021 and by 17% (£120) since Q4 2020

The organisation’s quarterly Rent Index also revealed that South West rents, which traditionally lag behind the national average, drew level for the first time, rising by £19 (2.33%) during Q4 2021, and by £54 (6.92%) from £780, the largest regional percentage increase during the past 12 months.

Average rents have increased across all property types since Q3 2021, with rents on detached properties increasing the most; on average by £26 (2.33%) to £1,143, and also rising £88 or 8.34% from Q3 2020.

 

Property Type  Q4 2021 Q3 2021 Q4 2021 vs Q3 2021 % Q4 2020 (£) 2021 Q4 vs 2020 Q4 %
Flats £847 £830 2.05% £803 5.48%
Terraced £810 £792 2.27% £759 6.72%
Semi-detached £905 £891 1.57% £847 6.85%
Detached £1,143 £1,117 2.33% £1,055 8.34%

The TDS also said that Q4 2021 rents also rose across most of England – with London, the South West, and Yorkshire seeing the largest value rises – contributing to an annual UK average rent increase of just over 4% for 2021.

Matt Trevett, Managing Director at The DPS, said: “During Q4 2021 rents increased in the vast majority of UK regions and across all property types, with demand for detached properties driving the greatest increase in rental value for these properties.

“Our figures also show that renters were less likely to move during the past 12 months, suggesting lower availability of stock and therefore perhaps more limited options for moving.

“We’re also seeing definitive signs of recovery in London, particularly the return of the popularity of flats in some areas, suggesting that some tenants are coming back to the capital.”

Paul Fryers, Managing Director of Zephyr Homeloans, a specialist buy-to-let mortgage provider also part of the Computershare group, said: ”There is currently significant pressure on rental stock across the country.

“Reasons are complex, but they include landlords selling up to capitalise on high sale prices, plus a shortage of new build homes as a result of supply chain and raw materials issues.

“We’re hearing stories of landlords receiving unprecedented levels of interest, with some renters willing to pay rents upfront and even stories of some tenants willing to pay over the odds to secure properties.”

Outside London rents in the city of York saw one of the highest increases: £71 (9.49%) from £748 to £819 during Q4 2021, a rise of £120 or 17.17% from £699 since Q4 2020, said The DPS.

Conversely, the organisation said the city of Southampton saw one of the largest falls in rental value during Q4 2021, decreasing £122, (-15.12%) from £807 to £685.

Average rents in the North East, traditionally one of the cheapest regions in the UK to rent, increased by £5 (0.91%) from £549 to £554 during Q4 2021, with rents increasing £34 (6.54%) during the past 12 months.

During Q4 2021 London rents increased for the second consecutive quarter, ending 2021 at £1,381, an increase of £42 (3.14%), the highest value regional increase, and a £64 (4.86%) increase on the same quarter during 2020.

The London borough of Islington saw the sharpest value rise in rent during Q4 2021, an increase of £273 (19.6%), from £1,393 to £1,666, added the organisation.

         
Region Average Rent Q4 2021 Change since Q3 2021 Change since Q4 2020 £ Change since Q4 2020 %
UK £834 £16 £42 5.30%
London £1,381 £42 £64 4.86%
South East £961 £12 £38 4.12%
South West £834 £19 £54 6.92%
East £883 £7 £52 6.26%
East Midlands £640 -£2 £28 4.58%
West Midlands £685 £14 £38 5.87%
Yorkshire £582 £19 £36 6.59%
North West £645 £10 £29 4.71%
North East £554 £5 £34 6.54%
Scotland £657 -£5 £5 0.77%
Wales £641 £20 £35 5.78%
Northern Ireland £571 £4 £20 3.63%


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