The UK average rent reached £784 in May 2014, up 11% annually says a new report from Sequence.
Demand from UK tenants was up 14% annually whereas the supply of rental homes decreased 7% in the same period.
Rents in London increased 7% year-on-year to £1,468 where the pace of the market shows no sign of slowing down with new agreed tenancies up 34% annually. The UK isn’t far behind with a 20% year-on-year rise.
London tenant demand (+35% annually) rose at more than 11 times the rate of supply (+3%).
Stephen Nation, Head of Lettings for Sequence, which includes Barnard Marcus, William H Brown and Fox & Sons, comments:
“Demand to rent across the UK remains insatiable with the number of tenants seeking to rent up 14% annually in May and 5% on the month. This demand still isn’t being met by supply however, now an all too familiar story in this market, with new rental properties available down by 7% on last year. This means that monthly rents will continue their upward trajectory – in May rents were up 11% on May 2013.
“The London market remains the most competitive across the UK and successful tenants need to move swiftly to secure a property. New agreed tenancies soared 34% annually in the Capital. Rental increases are more subdued than the national average, remaining flat on the month but up 7% annually. This is partly because we are seeing some new supply edging into the market.
“Buy-to-let mortgages remain our most popular mortgage product but applications are subdued in May, down 9% annually and 4% on the month. This can be attributed to a number of factors including the initial knock on effect of MMR and some uncertainty around interest rate rises.”