UK rental prices paid by private tenants rose by 1.8% in the 12 months to June 2017, fresh figures from the Office for National Statistics (ONS) show.
It was the third month in a row that rents increased by 1.8%, led by growth in England, where private rental prices grew by 1.9%, Wales saw growth of 1.1%, while Scotland saw rental prices increase by 0.2% in the 12 months to June 2017.
Between January 2011 and June 2017, private rental prices in Great Britain grew by 14.8%, fuelled primarily by price rises in London. But when the capital is excluded, private rental prices increased by 10.8% over the corresponding period.
However, despite historical growth in private rental prices within London, private rental prices in the city actually increased by 1.3% in the 12 months to June 2017, 0.5% below the national 12-month rate of growth.
John Goodall, CEO and co-founder of buy-to-let specialist lender Landbay commented: “While the pace of house price growth may have slowed, house prices still continue to rise, ultimately meaning that fewer people can afford to buy, which can only place greater pressure on the UK’s rental sector. For that reason it’s essential that new construction is planned across all tenures, so that rents don’t escalate to the point where they’re inhibiting aspiring homeowners’ ability to save for a deposit.
“Quite simply, we need to build more purpose built rental homes to support those hoping to take their first steps onto the property ladder.”