Rise in Rent is at a 13-year High
Rents have risen by 4.8% in Scotland over the past year.
The average cost of renting a home in the UK is close to £1,000 per month as demand pushes up prices. Despite this rise, rents account for an average of 37% of a single earner’s pre-tax wages. This is in line with the 10-year average of 36%.
According to the Zoopla Rental Market Report, the average UK rent is £969 per month – this is £62 per month higher than at the start of the pandemic. The rental rises are currently at a 13-year high of 8.3% in the fourth quarter of 2021. Going forward, rents are expected to rise by 4.5% across the UK.
Compared to five years ago, rents are 12% higher despite falling in some areas at the start of the Covid19 pandemic.
Rents have gone up in every region across the UK with the strongest growth of over 10% in London. Increases were the lowest in Scotland at 4.8%.
Rental demand has soared since the New Year, with the number of those looking for a new home 76% higher than the same period between 2018 and 2021. One of the results of the pandemic was that people have sought homes outside of city centres as homeworking and home study became the norm and people searched for more space. However, in the last few months people have started to return to the centres of major cities following the announcement that people need to start getting back to the office and college and universities get back to normal.
The increase in demand in rental properties is not being matched by the increase in supply. The number of homes available in January was 39% lower than would be expected for the first few months of the year.
With an imbalance of supply and demand of rental properties, the rental market is fast-moving, and competition is high. This has further pushed up the cost of renting. Properties are taking only 14 days to let, in late 2020 this was three weeks.
There has been a shortage of available properties as there has been a decrease in investment in the sector by landlords.
If you are looking for a rental property, it’s important that you can move fast to secure your new home. This is especially important if you’re renting in a city centre where demand is high.
If you’re a landlord, the strong demand for rental accommodation, combined with the shortage of availability, means that you are unlikely to experience void periods. The average rental yield in the UK is currently 4.86%.