The North-South England Rent Gap Narrows to Historic Low Levels
Recent data from the property company Hamptons has revealed that the disparity in rent prices between the north and south of England has decreased to its lowest level in over a decade. The average rent paid by tenants in the north of England in August stood at £960 per month, marking a notable 9.6% increase from the same period last year. This amount is significantly lower compared to the £1,317 average rent in the southern regions, representing the smallest percentage gap since the index was first introduced in 2013.
Over the past five years, the rental gap has been steadily decreasing, mirroring a similar trend in the housing market. Aneisha Beveridge, Head of Research at Hamptons, noted that this reduction in the rent disparity is primarily driven by the slowdown in rental growth across southern England due to increased affordability pressures. The narrowing gap is a significant shift from the 43% difference recorded last year and the peak of 55% in 2021.
Rent Trends Across Different Regions
Hamptons’ lettings index defines the north as encompassing the north-east, north-west, and Yorkshire & Humber regions, while the south includes London, the east of England, and the south-east & south-west areas. Among these regions, the north-east of England experienced the most significant rent increase, with a notable 12.1% rise year-on-year. In contrast, London saw the smallest growth in rent prices at just 2.1% compared to the previous year, a stark contrast to the 17.1% increase recorded in August 2021.
While tenants in the south have observed weaker growth in rental prices in percentage terms, the actual monetary increase remains substantial. For instance, renters in inner London faced a 7.9% rise in rent over the year, translating to an average monthly payment of £3,318 – £242 more than the previous year. Similarly, in the Midlands, a 7.2% increase led to an additional £66 per month in rent expenses.
Impact of Government Policies on Renters
The recent introduction of the Renters Reform Bill by the government aims to enhance renters’ rights in England by prohibiting no-fault evictions and limiting landlords from renting properties for more than the advertised price. While these changes are intended to benefit tenants, the National Residential Landlords Association has expressed concerns that landlords may respond by increasing rents in certain cases to offset potential losses or changes in rental practices.
The evolving landscape of the rental market in England reflects a complex interplay of economic factors, regional dynamics, and policy interventions. As the rent gap between the north and south continues to narrow, it underscores the importance of monitoring and addressing housing affordability issues to ensure a balanced and equitable rental market for all residents.
