Private residential rental prices paid by tenants in Great Britain rose by 2.1% in the 12 months to March 2015, the latest index shows.
Rental prices grew by 2.1% in England, 2.1% in Scotland and 0.8% in Wales in the 12 months to March 2015, according to the data from the Office of National Statistics.
Rental prices increased in all the English regions over the year to March 2015, with rental prices increasing the most in London at 3.2%, the data also shows.
It’s no surprise rents are rising, according to Matt Hutchinson, director of flat and house share site SpareRoom.co.uk. ‘We have a chronic shortage of housing in the areas where jobs are being created, so rents continue to rise as supply fails to meet demand. In some areas of London we’re seeing up to 13 people compete for every room advertised during peak months,’ he explained.
He believes that whoever forms the next government after next month’s general election will need to look at introducing policies aimed at making housing, of all tenures, genuinely affordable. ‘The upward pressure on rents is rapidly making the situation both unmanageable and unsustainable for tenants,’ he added.
Steve Bolton, chairman of Platinum Property Partners, pointed out that the blame for rising rental prices is often attributed to landlords, but it is because there are simply not enough suitable rental properties coming on to the market.
‘Rental demand is growing as first time buyers struggle to access the housing market and the UK’s workforce becomes increasingly mobile. At the same time, the number of new rental properties is lagging behind, creating a dangerous imbalance between supply and demand that is pushing rental prices upwards,’ he said.
‘Buy to let investors need to consider how they can meet growing rental demand in a way that is affordable for consumers. Houses in Multiple Occupation (HMOs) are a great way of creating high quality rental accommodation by making the most of existing housing stock,’ he explained.
‘They are also far more affordable than renting a one bedroom flat, providing young professionals with high quality accommodation that also enables them to save for their long term financial goals,’ he added.