The ONS published their new monthly index, the Price Index of Private Rents (PIPR) for March 2024. Here’s our summary.
Overall, renters are facing a significant challenge as private rental prices continue to climb. The provisional estimate has unveiled a 9.0% increase in average UK private rents over the 12 months leading up to February 2024.
The past year has seen a strong rise in rental prices across the UK, with the average monthly rent reaching new heights. England witnessed an 8.8% increase, with rents averaging £1,276, while Wales saw a similar surge, with rents climbing to £723. Scotland felt an even sharper pinch, with a 10.9% jump, pushing average rents to £944. Not to be overlooked, Northern Ireland experienced a 9.3% increase, although data is currently available only up to December 2023.
This trend is not just a blip on the radar. The Royal Institution of Chartered Surveyors (RICS) has reported a rising demand for rentals amidst a declining volume of new landlord instructions for the nineteenth consecutive month. This imbalance hints at continued rent increases in the foreseeable future.
A Closer Look by Country
England
In England, the situation is particularly pronounced in London, where rent inflation reached 10.6%—the highest since records began. The North East, on the other hand, saw the lowest inflation at 5.7%. London’s rents are the highest in England, averaging £2,035 per month, contrasting sharply with the North East’s more modest £658.
Wales and Scotland
Wales and Scotland are also grappling with rising rents, albeit with slight variations in their respective inflation rates. In Wales, the growth has somewhat slowed, marking the third consecutive month of deceleration. Scotland’s rent inflation has generally been slowing since its peak in August 2023, despite the latest 10.9% increase.
Northern Ireland
Northern Ireland’s data, capturing the scene up to December 2023, indicates a 9.3% increase in rents, showing a slight decrease from previous months but still highlighting the broader trend of rising rental costs.
The Extremes of the Market
The disparity in rental prices across the UK is stark. Kensington and Chelsea in London boast the highest average rent at £3,248, while Dumfries and Galloway in Scotland offer the most affordable options at just £472. This variation underscores the diverse challenges renters face depending on their location.
Property Size and Rent
The size of a property significantly influences its rental price. Detached properties and those with four or more bedrooms demand the highest rents, reflecting the premium placed on space and privacy. Conversely, flats and maisonettes, along with properties featuring just one bedroom, are on the lower end of the rent spectrum, offering slightly more affordable options for those willing to compromise on space.
The Future
As we look ahead, the data paints a picture of a rental market under strain, with demand outpacing supply and driving up costs. For renters, this means adapting to a reality where budgeting for housing takes an ever-larger slice of their income. For policymakers and stakeholders, it’s a call to action to address the imbalance and ensure that the housing market can meet the needs of its residents without compromising affordability and accessibility.