The latest Rent Index from The DPS reinforces the trend of rapidly growing rents over the past 12 months. Average UK rents have risen £66 to £870 since Q2 2021, an increase of 8.21%. This reflects the rise in inflation, currently running at 9.40%.
The rapid annual growth is the result of strong quarterly growth over the last 12 months. The quarterly percentage increases since Q2 2021 are the four biggest increases on record since we started gathering data in 2007, with the three quarters following Q2 2021 seeing growth between 1.74% and 1.96%.
This quarter saw growth accelerating faster than ever before, up 2.47% (£21), the first time quarterly growth has exceeded 2%.
Significant annual rent increases seen across the regions
Across the UK, average rents and have grown in all regions over the last 12 months. The North East region has seen the highest percentage rise in rents, increasing 10.75% (£57) with the West Midlands second highest, rising 10.70% (£69).
With the exception of Northern Ireland, where annual rents grew by a relatively modest 3.58% (£20), all regions have seen growth in rental rates of 5% or higher, with 8 of the 12 regions experiencing rises over 7%.
In pure value terms, London saw the greatest increase in monthly rent, rising on average by £124 over the last 12 months.
All property types benefitting from growth
While the pandemic reprioritised people’s property requirements, driving a shift away from flats and creating greater demand for larger properties, the last 12 months have seen all property types share significant increases in rental values.
Detached properties saw the highest rise of £105 (9.73%) now at £1,185, with flats rising £73 (8.99%) to £885. Semi-detached properties are up £69 (7.89%) to £943, and terraced properties now stand at £839, up £56 (7.15%).
For most regions, detached properties are seeing the highest rent increases and terraced properties the lowest. However, two regions, the West Midlands and London, saw double digit growth for average flat rental prices.
At a district level, within the West Midlands region, the highest rental growth was the district of Central West Midlands, rising £100 (15.72%). The district of Inner London also saw growth of £176 (12.87%). The rise in rentals for flats in these counties support the view that many tenants have spent the last 12 months returning to city living now Coronavirus restrictions have eased.
“The last 12 months of rent increases, including a significant acceleration during the last quarter, shows that the price of renting forms a substantial part in rising living costs across the country.
“A mixture of tenants moving back into cities, continued desire for larger rental properties with more space and a current shortage of properties of all types is causing rent prices to rise.
“Despite the current economic environment, many tenants still seem prepared to pay in order to secure a rental property.”
Matt Trevett, Managing Director, The DPS
The DPS Rent Index – The largest and most reliable indicator of rental trends
As the largest provider of deposit protection in the UK, we have a unique insight into the Private Rented Sector (PRS). Our database of domestic private rental prices across Britain is the largest of its kind. It's the most reliable indicator of rental trends in the UK.
Utilising a database of tenancies that covers rental market activity since 2007, we analyse data from millions of properties across the country. We include national statistics in our analysis to build a picture not only of rental cost but rental affordability.
This allows us to produce a rental index that’s statistically robust, reliable, and based on actual rather than advertised rents, delivering an accurate view of average rental values by property type across the UK.
Want more from your deposit protection provider?
Our free quarterly DPS Rent Index is just one of the reasons our customers rate us excellent on Trustpilot. Find out more and register for a DPS custodial account at depositprotection.com/join