VERAGE rents in Northern Ireland rose faster than any other UK region apart from the south west of England during August, according to the latest industry data from HomeLet Rental.
The 3.7 per cent spike in the north in August compared to the same month in 2016 easily eclipsed the UK average figure of 2.4 per cent, though the average monthly rental here is just £634 compared to £939 across all the regions.
This, however, is skewed by London, where tenants are stumping up a whopping £1,607 every month to keep a rented roof over their heads.
Nonetheless, the overall figures are seen are bringing welcome relief to landlords who have been battered by the perfect storm of tax changes and post-Brexit uncertainties.
The performance in Northern Ireland in this latest report is particularly stand-out, albeit from a modest sample size, putting it in second place of the 12 UK regions.
August’s increase in average rents was partly driven by a return to inflation in the London market, where rents agreed on new tenancies last month were 2.4 per cent higher than in August 2016.
Excluding London, rental price inflation has also picked up, with 10 out of the 11 remaining regions beyond the capital seeing rents increasing last month.
The average rent on a new tenancy in Northern Ireland was £634, up 3.7 per cent compared to the same period in 2016 when it was £610.
It was the fastest UK rise apart from the 3.9 per cent life in the south west of England, with only the south east of England recording a decline (-0.2 per cent).
HomeLet’s chief executive Martin Totty said: “While we’ve often observed a seasonal uplift in average rents at this time of year, there’s evidence of a trend now emerging which points to a reversal of the declines seen over the early part of this year.
“This will be welcome relief to landlords who have been battered by the perfect storm of tax changes and post-Brexit uncertainties.
“Whether the trend continues or represents only temporary relief from the headwinds faced by property owners, the remaining months of 2017 should provide the answer.”
He added: “Whether the recent strengthening in rents achieved, seen generally across all regions of the country, is driven by more robust demand or by some restriction of supply is hard to judge.
“Either way, landlords will only be encouraged to invest in property over other assets if they’re convinced they can achieve reasonable returns. If not, then the supply of rental properties could become constrained.
“Many landlords still face further increases in their costs and so will need to find a new equilibrium between their legitimate required returns and affordability for tenants. It seems the elements in solving that particular equation become ever more complex.”
The HomeLet index digs into data on new tenancies in the UK and processes information including the rental amounts agreed, the number of tenants moving into the property, together with the employment status, income and age of all tenants. Its trends are seen as giving a relevant insight into changes in the private rented sector.