Average London rent on the rise as price outside the capital reaches record high

The average advertised monthly rent in London has continued to rise while prices outside of the capital reached a record high, according to Rightmove.

The average monthly rent being asked outside London hit £1,316, seven per cent higher than a year earlier, according to Rightmove’s analysis covering the month of May.

In London, the average advertised rent is £2,652 per month, which is four per cent higher than a year earlier, the figures show.

With the General Election taking place on Thursday, Rightmove said the next government should accelerate housebuilding and incentivise landlords to invest in more homes for tenants, “to improve the supply and demand imbalance in the rental market and stabilise yearly rent growth”.

Rightmove said the pace of growth in rental prices has eased from its peak of 12 per cent two years ago but it remains significantly higher than the “more normal” level of around two per cent per year seen before the coronavirus pandemic.

It added that an improvement in the balance between supply and demand in London has contributed to a slowing of rental price growth. By contrast, Scotland is currently the hardest hit by supply and demand imbalances, Rightmove said.

Rightmove calls on new government to improve planning process

Tim Bannister, a property expert at Rightmove, said: “We’ve been talking about the imbalance between supply and demand in the rental market for a long time now, so it’s easy to forget that there was a time before the pandemic where rental price growth was more stable.”

He added: “The next government should be prioritising an improvement to the planning process, an acceleration of house building, and encouraging more supply into the rental market.”

Nathan Emerson, CEO of property professionals’ body Propertymark, said: “Propertymark has long argued that the private rental sector needs more houses to stabilise rental prices but there is a myriad of other factors that can contribute towards making the market more attractive for both investors and tenants.

“With a General Election coming this week, Propertymark would like to see the next government reform the tax system so that more investors can be persuaded to invest in the private rental sector and lower rents for tenants in the long term.

“Whilst we support a greater supply of houses, there has to be a sensible deliverable programme mindful of protecting the green belt wherever possible.”

How much does it cost to rent in and outside London?

The average advertised rent and the annual increase, according to Rightmove:

– North East, £894, 11 per cent

– West Midlands, £1,180, 10 per cent

– Scotland, £1,067, nine per cent

– East of England, £1,597, eight per cent

– North West, £1,146, eight per cent

– Yorkshire and the Humber, £1,022, eight per cent

– South West, £1,425, seven per cent

– East Midlands, £1,150, seven per cent

– South East, £1,836, six per cent

– London, £2,652, four per cent

– Wales, £1,065, four per cent

The biggest imbalances between supply and demand in the UK rent market

1. Scotland

2. North West

3. South West

4. North East

5. West Midlands

6. Wales

7. Yorkshire and the Humber

8. East of England

9. East Midlands

10. South East

11. London