18 February 2019
Tenants spend £1.9 billion less in rent than previous year, which is the first time this figure has fallen in more than 10 years
- Tenants in Great Britain paid £59.1 billion in rent in 2018, £1.9 billion less than in 2017
- Over the last 10 years the total rent bill has grown by £29.9 billion in Great Britain
- Nine out of 11 regions saw their total rent bill fall last year, but London saw the biggest drop of (-£0.62 billion)
- The rate of rental growth has slowed over the last 12 months in Great Britain. In January the average cost of a new let rose 0.6% year-on-year compared with 2.4% in January 2018
Last year private tenants in Great Britain paid £59.1 billion on rent, £1.9 billion less than in 2017. This is the first annual fall in over 10 years (table 1). The fall has been driven by a drop in the number of households renting and rental growth stagnating.
Table 1: Total rent paid in Great Britain (£billions rounded)
However, over the last 10 years the total rent bill has increased by £29.9 billion in Great Britain. During this period the number of households privately renting has grown by 1.7 million (+52%), meanwhile rents have increased by 12.4%.
Nine out of 11 regions in Great Britain saw a fall in their total rent bill over the last year; the only regions to see a rise were the East Midlands (£0.13 billion) and the North East (£0.06 billion). London saw the biggest drop off in the total amount of rent paid by tenants., totallying £20.6 billion in 2018, £0.62 billion less than in 2017 (table 2).
Table 2: Total rent paid by region (£billion)
Over the last 10 years the rental bill increased in every region with the biggest rise in the amount of rent paid by tenants being in the capital where the total rental bill grew by £10.53 billion over the 10-year period. After London, tenants in the South East (£14.19 billion) and the East (£3.05 billion) saw their rental bills rise the most. Meanwhile Wales saw the smallest rise in the total amount of rent paid by tenants over the last decade, up £0.07 billion (table 2).
The rate of rental growth has slowed over the last 12 months in Great Britain. In January the average cost of a new let rose 0.6% year-on-year compared with 2.4% in January last year (table 3). London led the slowdown over the last year, but rents have gradually started to rise again. The average cost of a new let in the capital rose 0.6% year-on-year in January. Meanwhile the South East and South West both recorded rents falling -0.5% year-on-year (table 3).
Table 3: New Lets Year on Year by Region
Commenting Aneisha Beveridge, Head of Research at Hamptons International, said:
“The total amount of rent paid by tenants in Great Britain fell for the first time in over a decade last year. Despite average rents rising 0.4% in 2018, fewer people renting homes meant the total rent bill shrank by £1.9 billion since 2017.
“Over the last 12 months rental growth in Great Britain has slowed. Rental growth has fallen from 2.4% in January 2018 to 0.6% last month. The slowdown over the last year was mainly driven by London, but rents are now gradually starting to rise again in the capital. Meanwhile the South East and South West both recorded falling rents last month.”