In an unprecedented upward shift, the cost to rent a home has surged by 12% in the year leading up to August, marking the steepest increase seen since Hamptons, the estate agency, began its tracking in 2014. As a result, a typical new lease now calls for a monthly rent of £1,304.
The spike seen in the last 12 months surpasses the cumulative increase observed in the preceding four-year span from 2015 to 2019, further signifying its significance. Such an escalation in rental costs can be attributed to the mounting pressure faced by landlords attributed to heightened mortgage rates coupled with a surge in tenant demand.
A limited supply of rental properties coupled with a rising demand has resulted in an imbalance. The scarcity of available options has, thusly, made renting a more costly affair. Official figures published last month revealed that the escalation in renting costs had reached its pinnacle since the inception of similar records.
This escalation prevails amidst a proposed legislative shift. A bill currently under consideration by Parliament seeks to ban unwarranted eviction of tenants. Landlords argue that this move could potentially result in an exodus from the sector, despite slow progress in the enactment of the new law, according to campaigners.
The scarcity of properties has led to a fierce competition amongst tenants, who are finding themselves in a diminishing pool of rental properties, inevitably leading to a further increase in rents.
The aforementioned data is derived from research carried out by Hamptons, which takes into account 90,000 homes let and managed annually by the larger Countrywide Group of estate and letting agents. The study adjusts for location and property type and is based upon finalised rather than advertised rents.
As per the findings, the average monthly rent in Britain surpassed the £1,300 threshold for the first time this past August, scarcely a year after it crossed the £1,200 mark. “Each subsequent month has set a fresh precedent in the rental market,” said Aneisha Beveridge, head of research at Hamptons. “The last 12 months have witnessed a rise in rents that outpaces the increment seen between 2015 and 2019.”
Beveridge adds, “Though the current rate of rental growth may be untenable in the long run, it’s worth noting that many landlords with mortgages find themselves in a similar squeeze.”
In an effort to secure a rental property amidst these challenges, industry insiders suggest a few practical steps. Begin your search well before your current lease expires and consider signing up with multiple agents. Consistently keep payslips, a work reference, and a previous landlord reference easily accessible. Cultivate relationships with agents in the area but be ready to broaden your search if necessary. Clearly define your budget and calculate your upfront offer. Lastly, remain vigilant of potential properties appearing on social media before official listings.
