With London rents growing at a pace which barely moves the needle, healthy growth is being achieved further north, and particularly in Scotland.
Over the past 12 months, London rents have slowed to a crawl, with a disappointing across the capital average of 0.66 per cent recorded to April. Contrast that with Scotland where the UK’s highest year-on-year rental growth was recorded, with Edinburgh rents increasing by 5.44 per cent and Glasgow by 2.59 per cent. Overall, the average rental growth across Scotland over 12 months was 1.74%, that’s according to Landbay’s Rental Index.
Rents in London last month were averaging £1,906, which compares to the UK’s nationwide figure of £1,218. In Scotland the average rent is £750, slightly less than the UK’s average excluding London at £773, clearly on the up, with Edinburgh City’s rental growth the highest of any region in the UK year-on-year.
Chief executive and co-founder of Landbay, John Goodall, has commented:
“Landlords can rest assured that there is decent rental growth to be found across the UK, particularly if they look north of London.
“On the face of it, landlords have had a tough time in the past few years, from increased regulatory pressure to a significant increase in stamp duty costs, yet they have managed to shoulder many of these costs without passing them onto tenants.
“For brokers, this provides them with the opportunity to give expert advice to their clients about changing elements of the housing market and which areas have the most potential in the coming months.”
In Wales rental growth was the second highest at 1.26 per cent, but rents are lower in Wales at an average of £658. Merthyr Tydfil saw the second highest rental growth in the UK at 4.65 per cent, while Blaenau Gwent was third at 3.92 per cent. In fact no Welsh region fell in the list of the 30 areas of lowest annual rental growth in the UK.
In England, Nottingham saw the highest rate of rental growth at 3.84 per cent, with Rutland and Leicester at 2.56 and 2.33 per cent respectively.
Overall, the East Midlands achieved a slightly higher growth rate as a region at 1.98 per cent than the overall average in Scotland.
But the north does not have it all: the West Country shows an exception to the north – south rental growth divide. North Somerset and South Gloucestershire in the South West, both show above average growth at 2.39 and 2.25 per cent respectively, with a regional average growth at 1.24 per cent.
In general, says Mortgage Introducer, landlords looking for rental growth in London may struggle, with average growth of just 0.66 per cent. For those determined to find rental growth in London, Islington may be the best bet, with year-on-year growth of 1.64 per cent. Wandsworth achieved 1.43 per cent and Southwark 1.35 per cent, all contrasting with falls at the top end with Kensington and Chelsea at -0.21 per cent and Westminster at -0.02% per cent.