Split the Difference
Rental growth stalls
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For the first time since November 2010, rents in Great Britain are lower than the same time last year. Data from Countrywide’s lettings index shows that rents fell nationally 0.6% over the last year to stand at £921 per month, £5 less than in February 2016. But rents are still 14% more than in their previous peak in 2007.
The fall was driven by London and the South East where rents fell 4.7% and 2.6% respectively. But it has taken seven months for falls in these regions to bring national rental growth below 0%. Apart from London and the South East, every other region of the country saw rents continue to rise, albeit at a slower rate than last month.
The slowdown in rental growth was caused by a fall in the number of tenants looking for a home combined with higher numbers of homes available to rent in London and the South East. While in Great Britain overall there were 5% more tenants looking for a home than at the same time last year, London and the South East both had fewer tenants looking than February 2016.
However, the surge in the number of homes available to rent following the rush to beat the stamp duty deadline is now beginning to subside. Overall there were 10% more homes available to rent in February than last year, but this is likely to fade over coming months. Early signs point towards 2017 being a rare year where rents rise faster in the north of the country than in the south.