Asking rents in London have increased to an average of £2,000 per month, making it the region with the highest annual growth for the first time since the end of 2014, the latest lettings index shows.
The data shows that asking rents in London increased by 3.4% on an annual basis in the second quarter of 2018 compared with a fall of 0.1% in the first quarter and were also up by 3.4% quarter on quarter.
Outside of London asking rents increased by just 0.7% on an annual basis to £796 per month and were up by 2.7% on a quarterly basis, according to the figures from property portal Rightmove. It says that annual growth has been dragged down by a flat market in the South West and falling rents in the South East.
Meanwhile, the rebound in London is driven by a lack of new property to let with supply down 3.5% compared with the second quarter of last year and this has led to the time to find a tenant speeding across the most of the capital.
After London the next highest asking rents are in the South East at £1,083, then £923 in the East of England, £797 in the South West, £686 in the West Midland, £674 in Scotland, £660 in the North West, £643 in Wales, £636 in the East Midlands, £602 in Yorkshire and the Humber and £559 in the North East.
The second highest annual growth was recorded in Scotland at 2.8%, followed by 2.7% in the East Midlands, 1.8% in Wales, 1.6% in the North East, 1.4% in the West Midlands, 1.3% in the North West, 1% in Yorkshire and the Humber and 0.3% in the East of England. Asking rents were unchanged in the South West and fell by 0.4% in the South East.
London was not the only region to see strong quarterly growth with Scotland also seeing asking rents up by 3.4% in the second quarter compared to the first three months of 2018 and the South East up 4.3%.
The next highest quarterly growth was 3.2% in the North West, followed by 2% in the East Midlands and the North East, growth of 1.9% in Wales, 1.7% in Yorkshire and the Humber, 1.6% in the South West, 1.4% in the East of England and 1.2% in the West Midlands.
Nationally on average it takes a letting agent just over a month, some 36 days, from the time a rental property goes on Rightmove until it is marked let agreed, which is the same length of time as last year.
Overall, properties are being let out fastest in the South West taking an average of 29 days, and the slowest in North East at an average of 44 days. More specifically it takes just 22 days in Stirling, Bristol and Ashford while in London, the time it takes to find a tenant has sped up from 44 days to 40 days, with the quickest areas being Bexleyheath at 23 days, Edmonton at 25 days and Blackfen also at 25 days.
‘After a few years of more plentiful supply in the London market we’ve now reached a point again where competition among tenants for a great rental home can be very high in the most popular rental areas of the capital,’ said Rightmove’s housing market Analyst Miles Shipside.
‘This reduced choice could be symptomatic of fewer landlords buying and some selling up as rental returns are being diminished by more onerous tax, and little or no growth in capital appreciation, along with increased demand from tenants,’ he explained.
‘Outside London there looks to be more choice for tenants, but those looking to rent in the South West and Yorkshire and the Humber should note that properties are moving faster than this time last year so they may need to move more quickly to secure a good quality home,’ he added.