Rents outside London rising at fastest rate since 2008

Rents outside London are soaring at their fastest rate in more than a decade, according to a property website.

Zoopla said private rental prices across the UK increased by 5% in the 12 months to the end of July - adding £456 a year to the average tenant's bill.

The 5% jump is the biggest recorded since Zoopla's index started in 2008.

The firm said it was down to increased demand for city living amid limited supply.

As lockdown restrictions have eased and businesses have reopened in city centres, there has been a marked return to more built-up areas, it said.

In August, the stock of property available to rent outside the capital was about a third below typical levels, while supply was already under pressure.

As a result, average rents for the UK, excluding London, stand at £790 per month, up from £752 a year ago.

Zoopla's head of research, Grainne Gilmore, said: "The strong levels of rental demand seen across the UK during August will moderate in line with seasonal trends, but overall demand for rental property is likely to remain higher than usual in the coming months, amid this swing back to city life."

She cautioned that the market would be likely to depend on the path of the Covid-19 virus and any potential lockdown restrictions being re-introduced.

"But given no deviation from the current landscape, the demand for rental property, coupled with lower levels of supply, will continue to put upward pressure on rents," she added.

Inner cities across the UK, such as Edinburgh, have seen the highest growth in demand, although Zoopla's data showed London saw a decline of -3.8% in July on an annual basis.

But competition remains fierce for properties, the platform said, with rents now typically agreed within just 15 days of a property being listed.

Halifax, the UK's biggest mortgage lender, recently said that while house prices hit a record high in August, the annual pace of growth in property values slowed.

It said, however, that the broader economic picture was positive, with high job vacancies and consumer confidence returning, which benefited the overall housing market.

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