This figure masks regional differences, as regions such as the East of England have seen prices fall while the South West is growing at 3.6% annually. On a non-seasonally adjusted basis, the average rent across England & Wales was £820 this month, down 1% compared with March 2018.
Look north for best returns
Your Move found that investor landlords in southern regions are now looking north for higher returns, as properties in northern areas continue to outstrip rival regions. In the North East the typical property returned 5% while in the North West that figure was 4.8%. This contrasts with an average yield of just 3.2% in London and 3.3% in both the South East and South West.
Wales was the only area where yields dropped between February and March, falling from 4.6% to 4.5% month-on-month. The average yield across all of England and Wales was 4.3% -the same as in February but down from the 4.4% recorded a year ago.
While the overall rental market in England and Wales remained steady, Your Move found that some areas are still growing at a rapid rate. Rents in the South West of England have grown by 3.6% in the past 12 months, demonstrating faster growth than any other region surveyed. The average rent in the South West is now £701.
Other areas to post strong growth include the West Midlands, where prices grew by 3.3% to reach £638, and in the Yorkshire and the Humber region, which has an average rent of £589 following a 2.3% increase in the last 12 months. These two regions saw prices drop on an annual basis. The East of England saw the biggest fall, as prices in the area decreased by 2% to hit £875. Prices fell by 1.3% in London but, with the average rent standing at £1,260 the capital remains by far the most expensive place to rent in England & Wales.
On a monthly basis, the East of England and North East both saw rents fall by 0.3%, the only two areas to post such a decline. The North East is the cheapest place to rent, with an average monthly charge of £539. Of those regions to see rents increase month-on-month, the West Midlands led the way with an average price rise of 0.4% in March. Rents in this region are now £638 per calendar month.
The average rent across all of England and Wales dropped month-on-month, falling by 0.1% between February and March. The average rent of £860 (seasonally adjusted) was flat compared with a year ago.
The proportion of tenants struggling with their finances remained below 10% in March, Your Move found. Some 9.4% of all tenancies were in arrears during the month, exactly the same ratio as found in February. The proportion of tenants in arrears remains well below the both the recent and all-time high recorded by Your Move. The all-time high of 14.6% was recorded in February 2010 while the most recent high of 13.7% was in July 2017.
Martyn Alderton, National Lettings Director at Your Move, comments: “Yields continue to perform strongly, with just one region offering lower returns this month than in February.
We continue to see landlords in the south of England looking further afield for their next rental opportunity, as northern properties deliver stronger yields. The growth of the urban rental market has created yield hotspots for private landlords in northern cities like Manchester and Liverpool. Universities in these major cities are attracting students from across the country. Young professionals are also increasingly relocating to the North. The investment in infrastructure and culture, for example the relocation of the BBC and ITV to Manchester, has undoubtedly boosted the desirability of the city among this group.”
