to let signs UK rents
Rent growth is slowing down in the UK, says HomeLet Getty

Landlords are absorbing higher costs rather than hiking rents for tenants, according to the HomeLet Rental Index.

Rents grew at their slowest pace in 2016 during September, said the index. The average UK rent rose 3% over the year to £910 a month. This was a 0.8% fall month-on-month.

"Landlords are being very careful to ensure rents remain affordable for tenants," said Martin Totty, HomeLet's chief executive.

"Despite factors such as higher stamp duty on purchases for buy-to-let investors, and the tax changes coming in from April 2017, it would appear so far landlords have absorbed any actual or expected decreases in their yields, rather than pass this on through higher rents."

As well as putting an extra 3% on stamp duty for buyers of additional properties, the Treasury is cutting tax reliefs for landlords for costs such as mortgage interest and maintenance.

Rents are rising fastest in the West Midlands, said HomeLet, where the average rose 5.6% over the year to £665. They are falling in Scotland, where the average dipped 1.7% to £610. Rents are highest in London. The city's average rose 3% to £1,555.

RegionAverage rent in September 2016Average rent in August 2016Average rent in September 2015Monthly variationAnnual variation
West Midlands£665£667£630-0.4%5.6%
East of England£904£907£864-0.4%4.7%
North West£683£679£6570.6%4.0%
Northern Ireland£594£596£576-0.4%3.2%
Greater London£1,555£1,561£1,510-0.4%3.0%
Yorkshire & Humberside£621£626£607-0.8%2.2%
East Midlands£602£602£5900.1%2.1%
South East£1,020£1,048£1,003-2.6%1.7%
South West£799£818£790-2.2%1.2%
North East£530£534£530-0.7%0.0%
Notes:Based on new tenancies in September 2016Based on new tenancies in August 2016Based on new tenancies in September 2015Comparison of average rent in September 2016 and August 2016Comparison of average rent in September 2016 and September 2015

Source: HomeLet Rental Index, September 2016