Rent growth slows as uncertainty continues
Renters are holding back on signing new tenancies amid continuing uncertainty in the housing market, new research has revealed.
According to the Landbay Rental Index, rents in the UK grew by just 0.02% in May as instability surrounding today’s election and ongoing Brexit negotiations continue to have an impact on the market.
The report found rents in London actually fell by -0.94% in the year to May. Rents have now fallen for 12 consecutive months in London.
London was the only UK region to see rents fall in May, but seven out of 12 regions ended the month with a slower rate of growth than seen in April.
John Goodall, chief executive officer and founder of Landbay, said: “The election is one of many external factors influencing activity in the buy to let market at the moment. Yes, uncertainty about the future of the UK will cause some people to delay a decision to move, but affordability pressures are also starting to pinch the pockets of renters across the country.
“Wage growth is now lagging behind inflation for the first time since mid-2014, and with less money to spend on such a major monthly outlay, renters will be factoring this into their tenancy decisions.
“On the supply side, a wave of new rental properties caused by last spring’s hike to Stamp Duty, together with falling house prices, will no doubt both be playing a small part in the ongoing softening of rental growth. Nevertheless, barring a major surprise from either the election or the Brexit negotiations, long-term population and construction trends suggest that rents will soon be growing faster than inflation again.”