More property options for tenants has led to a slower pace of rental growth so far in 2017 in the UK, with asking values up just 1.8% year on year.
This is the lowest rate of annual growth since the fourth quarter of 2014 and less than half of the rate recorded a year ago, according to the latest Q1 2017 Index report from Rightmove.
The data also shows that for the first time since 2014 the asking price for rentals outside London fell in the first quarter of the year, down by 0.4% on the previous quarter, taking the average to £768 per month.
In Greater London, the average rental in the first three months of the year was £1,937 per month, up 1.5% quarter on quarter while the annual fall has gone from a decline of 4.4% in the fourth quarter of 2016 to 4.2% in the first quarter of 2017.
Property taking More Time to Let
The time it takes to let a property has been calculated based on agents who have marked properties as let agreed on Rightmove. Nationally, it’s taking 10% longer on average to secure tenants than the same period last year. The time has increased in all regions except Wales, which has sped up by 5%. In London properties are taking 20% longer to let than a year ago.
Some parts of the country have seen a flood of properties into the market and the balance has tipped in favour of tenants. Last November, the average rent in London was 0.7% lower than a year earlier, the biggest fall in six years.
Savills, however, has forecast that while across the UK rents will rise by 2.5% in 2017, in London the increase will be 3%. It said this would be supported by higher earnings growth and households made up of more sharers to pay the rent. Across the UK most commentators predict rent rises of 2-3%.