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posted 21st February 2023
Private rental prices in the UK rose by 4.4% in the 12 months to January 2023, up from 4.2% in the 12 months to December 2022, marking the largest annual percentage change since the UK series began in January 2016. Within England, the East Midlands saw the highest annual percentage change in private rental prices in the 12 months to January 2023 at 5.0%, while the West Midlands saw the lowest at 3.9%.
Annual private rental prices increased by 4.3% in England, 3.9% in Wales, and 4.5% in Scotland in the 12 months to January 2023. Private rental prices in London increased by 4.3% in the same period, up from an increase of 4.0% in December 2022, and representing the strongest annual percentage change since August 2015.
The rental market in Greater Manchester has seen significant price hikes over the past 12 months, with rents up by 12.1% on average, and up to 15.6% in the largest cities like Manchester. The demand for rental properties continues to outstrip supply, leading to a "chronic imbalance". This situation has been exacerbated by rising mortgage rates, which are making it harder for first-time buyers to get on the property ladder, and resulting in more people needing to rent. With affordability pressures at their highest level in a decade, renters in the region are feeling the pinch, with the average rent increase over the past year being £117 per month or £1,400 per year.
The East Midlands had the largest annual percentage change in rental prices in the 12 months leading to January 2023, with a rise of 5.0%. It also had the fastest annual increase in rental prices throughout 2022. On the other hand, the West Midlands had the lowest annual rental price percentage change of all English regions at 3.9% for the same period.
In summary, private rental prices in the UK are on the rise, with strong annual percentage changes seen in England, Wales, Scotland, and London. The East Midlands had the highest annual percentage change, while the West Midlands had the lowest. The slowdown in tenant demand growth is contributing to supply shortages and higher rental prices, which may continue in the near term.
