London was the only region to see rents fall in the year to September, with prices decreasing by 1.3% in the last 12 months, yet the capital remains the most expensive place to rent in the country, the Your Move England and Wales rental tracker has found.
The average rent across England and Wales grew by 2.3% in the last year, hitting an average of £861 (seasonally adjusted). This figure was virtually flat compared to August. Across all regions, on a non-seasonally adjusted basis, the average property let for £944 this month.
Martyn Alderton, national lettings director at Your Move, said: “Students up and down the country are beginning to return to their universities.
“Yet far from the outdated stereotypes of ropey student digs, many young people are able to access top quality student accommodation in their place of study.
“The growth of the student rental market has been a boon for landlords who have invested in good quality properties.
“Yet the number of living options for students means that there is real competition, with landlords having to ensure quality is high to attract the best tenants.”
September sees the start of the new academic year and typically causes a surge in activity in the private rental sector. This year was no exception as students returned to their university towns and cities.
The majority of regions saw rents rise compared to the previous month, and all but one increased on an annual basis. The only region to buck the trend was London with the average rental price is now £1,271 per calendar month.
The strongest annual growth came in the South West, where prices have risen by 4.3% to it £686 a month. The next fastest price rise was in the East Midlands, where the average property is now worth £656 after growth of 2.4% in the last year.
Rounding out the top three was the South East where rental prices increased by 1.8% to hit £895 in the year to September. It remains the second most expensive place to rent, followed by the East of England. In the East, prices rose a modest 0.7% to £890.
Last month, both the North East and Wales recorded annual rent falls. However, both markets have returned to growth this month. In Wales, prices grew by 0.3% to reach £588 while average rents in the North East increased by 0.2% to £535.
On a monthly basis, the West Midlands and South West were the standout performers. Both regions saw average rent increases of 0.4% between August and September.
Three regions – London, the East of England and Wales – recorded price falls compared to the previous month.
The returns delivered to landlords and property investors remained competitive in September, with each of the 10 regions offering the same level of yield to investors this month as they did in the previous survey.
As is typical, properties located in northern regions earned higher percentage returns than those located in southern areas.
The average investor in the North East enjoyed an annual yield of 5% in the year to September while in the North West this figure was 4.8%.
London investors once again had the smallest percentage returns, recording 3.2% during the month.
However, when all properties in England and Wales are considered, the average yield remained at 4.4%.
Tenant arrears ticked up slightly between August and September, although the financial picture for the nation’s renters remained strong.
Some 10.1% of all tenancies were behind with their payments this month, slightly higher than the 9.7% recorded in August.
However, the proportion of tenants in arrears remains well below both the recent and all-time high recorded by Your Move.
The all-time high of 14.6% was recorded in February 2010 while the most recent high of 13.7% was found in July 2017.