Average rents in England and Wales increased in February but growth is slowing
Average rents in England and Wales increased by 0.4% month on month in February and were 1.4% higher than the same month in 2018, the latest rental tracker index shows.
Across all of England and Wales the average rent was £861 per calendar month but rents have increased the most in the South West, up 4% year on year, according to the data from Your Move.
The report suggests that many landlords are looking beyond London for higher yields and cheaper purchase prices for new properties and as a result cities in the South West, such as Bristol, have continued to boom in popularity, with this increased demand causing rents to rise.
Other beneficiaries of this shift away from the capital were the West Midlands, where prices rose 3.1% and the Yorkshire and Humber region where rents increase by 2.1%. In the West Midlands the average rent now stands at £636 while in Yorkshire that figure is £588.
The latter remains the second cheapest place to rent in this survey, just ahead of the North East. In this region the typical rent is £540, some 1% higher than a year ago. London was one of two regions to see prices fall on an annual basis, the other being the East of England where prices fell 1.8% to £878 per calendar month.
The data also shows that yields in Northern regions have continued to outstrip those in southern areas. The average return on properties in the North East was 5% during February, closely followed by the North West at 4.8% while in London it was just 3.2%.
However the report points out that on an absolute basis, the returns in London are much higher due to more expensive property prices in the capital. The returns in each of the 10 regions surveyed were the same in February as January. The average yield across all of England and Wales was 4.3%, down from 4.4% a year ago.
‘Renters have been drawn to Bristol, not only because of its vibrant arts and cultural scene but also its strong job prospects. This has been accompanied by a boom in build to rent in the city, which has driven up demand and the average rent across the region,’ said Martyn Alderton, national lettings director at Your Move.
‘Private landlords meanwhile have tended to prefer the charms of the north of England, a region where yields are significantly higher than elsewhere. But returns in all regions have remained steady compared with January, meaning landlords across the country have enjoyed solid yields,’ he added.