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The regions overtake London as rents rise rapidly across the UK
May 22, 2015Article by Charlotte Ashton
New figures from Homelet have shown that the UK’s regional cities are outpacing London so far as rental rate rises are concerned. Across the country, rental prices in newly agreed tenancies rose by 10% in the three months to April 2015, with the South West recording the largest increases, at 15.5%.
The rise of the regions
In fact, London slipped to fourth place on the list when it came to the rate at which rents are growing. Homelet’s spokesperson comments,
“For the first time we are seeing rent price growth rates in Greater London converge with those across the rest of the UK. During 2014, London rent price growth far outpaced other regions but in 2015 we are seeing the emergence of a different pattern.
“What this tells us is that the private rental market is experiencing demand nationwide and that it is not simply a London phenomenon that increasing numbers of people are requiring privately rented property.”
Manchester leads the North
Ray Withers, Chief Executive of leading property investment specialists Property Frontiers, has observed rapid rental rate rises in a number of areas of the North of England in recent months. He comments,
“Manchester is the place to be in the North for strong rental yields right now. Custom Quay, for example, is benefiting from a yield increase in line with two new valuations of the development. Yields are now projected to reach 8.4%, which is excellent news for investors.“
The 60 one and two bed apartments and duplexes at Custom Quay are ideal for the growing class of young professionals who have flocked to Salford Quays in recent years and are demanding luxury accommodation in a prime location. Buy-to-let investors can be part of the area’s bright future from as little as £127,000.
House prices follow suit
Nor is it just rents that are outpacing London. The May 2015 LSL/Acadata house price index saw house prices in both the South East and East Anglia rising more rapidly than those in London. According to Acadata, the average house price in England and Wales has now risen to £275,961.
One of the main reasons for the rises – in London as well as the regions – is the chronic lack of supply that the UK is experiencing in terms of new homes coming onto the market. The lack of availability and affordability has reached such levels that Jeremy Blackburn, head of policy at the Royal Institution of Chartered Surveyors has referred to it as “a national emergency.”
While new builds and redevelopments are springing up around the country, the pace is still far behind that required in order to house Britain’s increasing number of households, which is excellent news for buy-to-let investors across the UK.
For more information about leading buy-to-let investment opportunities in Salford Quays and across the UK, contact Property Frontiers or call +44 1865 202 700.