Renting became more affordable in 2018, thanks to a
combination of a once-in-a-decade annual decline in rent prices and wage
inflation, according to The Deposit Protection Service (The DPS).
2018 was the first calendar year since the global financial crisis
of 2008 that the average rent price in the UK dropped, with the percentage of
typical wages spent on rent falling by 0.5%, to 31%, according to the latest
Rent Index from The DPS.
The average wage rose by 2.83% between January and December
last year, according to the Office for National Statistics (ONS).
Julian Foster, the Chief Operating Officer at Computershare
Investor Services, which produces the annual report, comments: ”This first drop in average annual rents for
almost ten years is good news for UK renters, especially if wages continue to
climb in 2019.”
The average rent price
fell by 1.17% (£9) over the past 12 months, from £774 per month in 2017 to £765
The greatest annual decline was recorded in Yorkshire and
the Humber, where the average rent dropped by 3.63% (£21) to £546 a month,
making it the third most affordable region in the UK, after the North East
(£529) and Northern Ireland (£544).
Prices in the North East decreased by 1.47% (£8) on an
annual basis, with the average rent in the region standing around 32% lower
than the national average.
The second most affordable region was Northern Ireland,
although rent prices rose from historically low levels by 2.38% last year, from
£532 per month to £544.
Scotland and Wales witnessed modest rent price growth on
2017, with Scottish rents rising by a marginal 0.19% (£1), while rents
increased by 1.42% (£8) in Wales.
In England, only the South West (0.21%) and West Midlands
(0.12%) experienced annual rent price growth last year, with these increases
equivalent to around an additional £1.
As in 2017, London, the South East and East of England were
the only regions in 2018 where average rents were above the UK national
London continues to hold the most expensive rent price in
the UK, at an average of £1,294 a month. This is 69% higher than the national
average and represents 41% of a typical wage in the capital.
Decreases in rents were experienced for all property types
in 2018, with terraced houses recording the greatest decline (2.49%), taking a
typical rent on this type of property to £711 per month.
This report should come as good news for tenants!