Buy to let rents hit two year peak
According to the latest data, buy to let rents are still increasing with tenants paying an average £947 a month.
Rents increased 0.9% in August, compared to a year ago, hitting their highest since August 2016 when tenants paid an average £917 a month.
But buy to let is still a two-speed market driven by rent increases in London, says the research by tenant referencing firm Homelet.
In the capital, rents rose by 1.4% in August, compared to 12 months ago. Tenants are now paying an average £1,632 a month for a private rented home. But when London rents are stripped from the data, the average rent for the rest of the UK is £786, boosting the annual increase from 0.9% to 1.3%.
The highest year-on-year rent increases for August were in Scotland (5.6%) and Northern Ireland (4.6%).
Four regions posted falling rents – including the North East (-2.2%), followed by Wales, the East of England and South West (all -1.4%).
The cheapest rents are in the North East – an average £526 a month, down from £538 a year ago.
Housing costs as a percentage of gross household pay have risen from 27.6% in August 2017 to 31% last month, which is an annual increase of 3.4%.
In the North East, this falls to 22.7% – down 0.9% in the year – but rises to 35.3% in London, where housing costs gobbled an extra 4.7% of gross household income in August 2018, compared to a year ago.
In London, rent costs have increased the most in the past year in Haringey and Islington (up 13.9%), Tower Hamlets (up 7.7%) and Camden and the City (up 7.4%).
Meanwhile, rents have fallen the most in Harrow and Hillingdon (down 6.1%), Enfield (down 4.8%) and Croydon (down 4.7%).
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