Average UK rents drop for the first time in six years
The UK has seen average rents decrease for the first time since 2017 during the first quarter of 2018, according to data from The Deposit Protection Service (The DPS).
The latest version of its Rent Index – based on figures from millions of properties across England, Wales, Scotland and Northern Ireland over the past decade – found the average UK monthly rent in Q1 2018 was £772, down 0.54% from Q4 2017 when monthly rents were £776.
The DPS also said that the UK may experience its first annual rental decrease since Q4 2009 if rents remain unchanged or there is another decline in the second quarter of 2018.
Julian Foster, managing director at The DPS, said this drop could represent the beginning of a ‘substantial development for the housing sector’ and an indicator for understanding the wider economy.
“Rent growth began to slow in summer 2016, and the slip into negative figures suggests that there is a genuine long-term issue affecting the private rented sector,” she added.
“The UK-wide decrease implies that there is more at play than a short-term or local correction to excessive prices, and a similar reduction in Q2 could represent the first annual decrease in rents since 2009.”
Regionally, Northern Ireland saw the biggest percentage decrease overall, with average rents falling from £544 to £527 (down 3.14%), replacing the North East as the most affordable UK region to rent property.
Meanwhile, London experienced a 1.39% drop in average rent, from £1,325 to £1,307 – the largest fall in value of any UK region and the second consecutive decrease for the capital on a quarterly basis.
Only four UK regions saw a rise in average rent: the South East (£870 to £879), the East Midlands (£599 to £602), the North West (£594 to £595) and Wales (£573 to £594).
What’s more, all property types became cheaper to rent on average, with flats experiencing the biggest quarterly decrease of 1.20%, from £796 to £786.