The Daily Telegraph

Average rents move 1.1pc higher to £925 after three months of decline

- By Isabelle Fraser

RENTS across the UK have bounced back after falling for the last three months, as new research has revealed that worries about a slumping housing market in London may be overplayed.

Homelet found that in July, the average rent was 1.1pc higher than in the same period last year, with Northern Ireland, Scotland and the East Midlands fuelling the new-found growth. It was held back by London, where rents were 0.6pc lower than last year, the fourth successive month of falling rents.

Martin Totty, Homelet’s chief executive, said: “Whether the market has now found some equilibriu­m remains to be seen, but landlords, at least, will be grateful for even some short respite.” The average UK rent is now £925 per month.

It comes as analysis of long-term trends in house prices and transactio­n levels by Hometrack has revealed that the number of homes sold had fallen far more steeply in the 2000s than in this current period of low activity.

While last year HMRC figures showed that property sales in London fell by 2pc, in 2003 they slumped by 12pc, while in 2005 that fall was by 14pc. However, the number of homes sold last year was lower than in those years, having never recovered from the financial crisis.

Richard Donnell, head of research at Hometrack, said that it was helpful to “look back at history to look forward”.

He added: “If you base today off the last cycle, we are in a position of the market in 2001-2, rather than 2006. But every cycle is different, and now we have more control and mortgage regulation.”

The monthly surveys of the housing market by the Royal Institutio­n of Chartered Surveyors have indicated a slowing market in the months since the referendum last June with stock at record lows, and it is due to report another one this week.

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