Rents in the UK saw their first annual fall since 2011 according to figures from Countrywide, attributed to a surge in the supply of properties available.
Britain’s largest estate and lettings agency found that the average monthly rent in the UK was £921 during February, £5 cheaper than it was in February 2016.
Tenant demand has been falling, especially in London, where there has been a 3 per cent decrease in tenants looking for properties to rent. At the same time, the supply of new homes in the capital rose 18 per cent. A significant reason for this is believed to be the 3 per cent stamp duty surcharge coming into effect this April, sparking a surge of landlords into buying property quickly, as well as Brexit.
Although the average cost of renting has fallen, it is still £112 more than the previous high reached in 2007.
In the year to February, rents fell 1 per cent in Central London, 4.7 per cent in Greater London, 2.6 per cent in the South-East, and 0.6 overall in the UK.
However, when excluding London, UK rents are 0.8 per cent higher than last year. The 5.3 per cent increase in Wales was the largest experienced, followed by a 3.1 per cent increase in east England and a 2.8 per cent rise across the Midlands.
“Economic and housing sentiment - both in sales and rental markets - has been affected by our vote to leave the EU, in London more than anywhere else,” said Johnny Morris, research director at Countrywide.
“This uncertainty causes tenants to be more cautious, meaning less likely to move and more likely to look for cheaper accommodation, e.g. sharing. With the private rented sector home to around three quarters of new migrants, any future substantial shift in migration patterns would likely have a knock-on effect on rents.”
