Private rental prices paid by tenants in the UK rose by 1.3% in the 12 months to October 2019, unchanged since May 2019.
In England, private rental prices grew by 1.4%, Wales experienced growth of 1.2%, while in Scotland private rental prices increased by 0.7% in the 12 months to October 2019.
London private rental prices rose by 0.9% in the 12 months to October 2019.
The Index of Private Housing Rental Prices (IPHRP) measures the change in the price tenants face when renting residential property from private landlords, thereby allowing a comparison between the prices tenants are charged in the current month and the same month in the previous year. The index does not only measure the change in newly advertised rental prices, but reflects price changes for all private rental properties.
The IPHRP is constructed using administrative data, that is, the index makes use of data that are already collected for other purposes to estimate rental prices. The sources of private rental prices are Valuation Office Agency (VOA), Scottish Government, Welsh Government and Northern Ireland Housing Executive (NIHE). All these organisations deploy rental officers to collect the price paid for privately rented properties. Data for Northern Ireland also include data provided by propertynews.com. Annually, over 450,000 private rents prices are collected in England, 30,000 in Wales, 25,000 in Scotland and 15,000 in Northern Ireland. The sources of expenditure weights are the Ministry of Housing, Communities and Local Government (MHCLG), Scottish Government, Welsh Government, Northern Ireland Housing Executive and the VOA.
IPHRP is released as an Experimental Statistic. While the methodology (PDF, 2.41MB) for IPHRP is final, Northern Ireland data were previously excluded from the price index. We have since worked with the Northern Ireland Housing Executive to secure private rental data for Northern Ireland with results first published in our September 2018 release on 19 September 2018. We have also used these data to improve the coverage of IPHRP to that of the UK, which was published for the first time in our September 2018 release on 17 October 2018.Nôl i'r tabl cynnwys
Private rental prices paid by tenants in the UK increased by 1.3% in the 12 months to October 2019, unchanged since May 2019. For example, a property that was rented for £500 per month in October 2018, which saw its rent increase by the average rate in the UK, would be rented for £506.50 in October 2019. Growth in private rental prices paid by tenants in the UK generally slowed since the beginning of 2016, driven mainly by a slowdown in London over the same period. Rental growth has started to pick up since the end of 2018, driven by strengthening growth in London.
Rental prices for the UK excluding London increased by 1.5% in the 12 months to October 2019, unchanged since January 2019 (Figure 1). London private rental prices increased by 0.9% in the 12 months to October 2019.
The Royal Institution of Chartered Surveyors’ (RICS’s) September 2019 Residential Market Survey reported that demand from prospective tenants has risen for an eighth month in a row. Alongside this, landlord instructions continue to decline.
The Association of Residential Letting Agents (ARLA) reported in their Private Rented Sector Report: September 2019 that demand from prospective tenants decreased while the number of landlords exiting the market remained the same.
These supply and demand pressures can take time to feed through to the Index of Private Housing Rental Prices (IPHRP), which reflects price changes for all private rental properties, rather than only newly advertised rental properties.
Focusing on the long-term trend, between January 2015 and October 2019, private rental prices in the UK increased by 8.1% (Figure 2).
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In England, private rental prices grew by 1.4% in the 12 months to October 2019, up slightly from 1.3% in the year to September 2019. When London is excluded from England, privately rented properties increased by 1.6% in the 12 months to October 2019.
Private rental prices in Wales grew by 1.2% in the 12 months to October 2019, unchanged from August 2019.
Rental prices in Scotland increased by 0.7% in the 12 months to October 2019, down from 0.8% since September 2019. The weaker growth in Scotland since 2016 may be because of stronger supply and weaker demand in Scotland, as reported by the Association of Residential Letting Agents (ARLA).
The annual rate of change for Northern Ireland (1.9%) in June 2019 is higher than the other countries of the UK. The Northern Ireland annual growth rate has remained broadly consistent around 2% since 2018. Northern Ireland data have been copied forward since June 2019. The next update to Northern Ireland data will be in the release on 16 December 2019.
All UK countries have experienced rises in their private rental prices since 2015 (Figure 4). Since January 2015, rental prices in England have increased more than those in Wales, Scotland and Northern Ireland.
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London private rental prices increased by 0.9% in the 12 months to October 2019. The Royal Institution of Chartered Surveyors (RICS) reported in their October 2018 Residential Market Survey that tenant demand has staged a sustained recovery in London, increasingly outstripping supply. These effects may be now starting to feed through to the Index of Private Housing Rental Prices.
Focusing on the English regions, the largest annual rental price increase was in the South West (2.2%), up from 2.1% in September 2019 (Figure 5). This was followed by the East Midlands (1.9%), Yorkshire and the Humber (1.8%) and the South East (1.7%).
The lowest annual rental price growth was in the North East where prices increased by 0.4%, followed by London, which increased by 0.9% in the 12 months to October 2019.
Figure 6 shows the historical 12-month percentage growth rate in the rental prices of each of the English regions.
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Since the passing of the Digital Economy Act 2017, the Office for National Statistics (ONS) and the Valuation Office Agency (VOA) have been working together to agree better access to the VOA private rental microdata. We now have access to this microdata, which will enable improved assurance of the data used in the construction of the Index of Private Housing Rental Prices and the owner occupiers’ housing component of Consumer Prices Index including owner occupiers’ housing costs (CPIH).
Alongside this, the ONS will also be taking over the production and publication of Private Rental Market Statistics (PRMS), currently published by the Valuation Office Agency. The first release of these statistics by the ONS is scheduled for publication on 13 December 2019.
Access to VOA private rental microdata and publication of the PRMS will allow us to consider future developments to rental statistics to better meet user needs. We aim to re-develop the Index of Private Housing Rental Prices and PRMS and produce mix-adjusted average rental prices that are comparable over time and geography down to lower geographic levels.
More information and a timetable for these developments will be released once we have had an opportunity to analyse the rental microdata further. If you have any queries or feedback on these developments, please contact firstname.lastname@example.org.Nôl i'r tabl cynnwys
The Index of Private Housing Rental Prices Quality and Methodology Information report contains important information on:
- the strengths and limitations of the data and how it compares with related data
- uses and users of the data
- how the output was created
- the quality of the output including the accuracy of the data
Private rental growth measures, a UK comparison compares the growth in the Index of Private Housing Rental Prices to other measures of private rental growth.
Quality assurance of administrative data used in private rental housing statistics documents the administrative data sources used in the production of the Index of Private Housing Rental Prices and the quality assurance processes applied to them.Nôl i'r tabl cynnwys