Average rents continuing to grow
The number of people renting from a private landlord has reached its highest level for over 30 years.
The average rent achieved for a newly let residential property in the UK rose in September by 3.6 per cent year-on-year to £941 per month, the latest figures from Countrywide reveals.
The research found that rents continued their growth over the year, with prices supported by falling numbers of homes available to rent and sustained demand from tenants.
The study also shows that the gap between the areas where many people can afford to rent and where they can afford to acquire property has continued to widen, owed largely to the fact that house price growth has outstripped rents across most parts of the country in recent years.
As a result, more than half of tenants – 51 per cent – who purchase a property do so outside the town or city where they were renting, compared to 38 per cent in 2008.
This trend is most evident in London where a third of renters – 36 per cent – who take their first steps on the housing ladder end up living outside the M25, up from a fifth – 21 per cent – in 2008, reflecting a surge in property prices over the past seven years.
Johnny Morris (right), Research Director at Countrywide, said, “Renting enables many tenants to live in areas where they could not afford to buy but that means aspiring home owners often have to look elsewhere to find a home they can afford. It’s common for first time buyers to make sacrifices to buy their first home, so with price rises in recent years outstripping income growth, more are choosing to bypass rising prices by looking further for cheaper areas.”
A separate study from the think-tank ResPublica shows that with the price of property continuing to increase, renting for many people is currently the only affordable option, with the number of people renting from a private landlord now at its highest level for more than 30 years.
The research reveals that 22 per cent at the present rent from private landlords, up from 9 per cent in 1985.
“At the moment we are failing to extend economic ownership to everyone, ownership is an unrealisable dream for too many,” said Phillip Blond, Director of ResPublica.
