According to Rightmove’s latest rental price tracker, asking rents rose in 2016 by 3% in 2016 in all regions except London. The rise was just slightly lower than 2015’s rise of 3.7%. The highest growth recorded in the northern regions of Yorkshire and the Humber and the North West.
In London, more available rental stock throughout the year led to a 4.4% annual drop in prices across the capital. In Inner London rents fell by 5.2% while there was a smaller drop of 2.5% in Outer London.
The top three areas with the highest rental growth in 2016 were:
- Swansea reported an 11.4% annual increase
- Gillingham, Kent where asking rents were up 11.1%.
- Bath had a 10.5% increase. Bath also reported the highest annual growth for asking prices in 2016, up 17.8% to £485,491
The top locations for demand from tenants on Rightmove was dominated by the north, including Ashton-Under-Lyne and Oldham in Greater Manchester, and Stockport in Cheshire. In London, more affordable areas such as Rainham, Bexleyheath and Erith came top as tenants looked for better value in Outer London.
Rightmove are predicting asking rents outside London to rise by 4% in 2017, where less availability of rental stock will result in an upwards price pressure for tenants
Sam Mitchell, Heat of Lettings at Rightmove, said “Investors looking for the strongest yields could consider investing in certain areas in the North West where both demand and yields are high. Those with a number of properties in the capital may find that tenants are more price sensitive, so setting realistic rent levels will be the key to avoiding void periods. In order to mitigate this, we would recommend landlords asking for longer tenancies to help secure a steady rental income over the next few years while they adjust to what the tax changes will mean for them.”
You can read the full Rightmove Rental Price Tracker Report by clicking here