- Average cost of renting a property in Britain increased by just £7 (0.75%) in October
- Advertised rents in London continue to increase but remain £42 down on last year
While still a weaker market than that of 12 months ago, the monthly increase of 1.47% in average rents means that the capital remains approximately 209%* more expensive than the rest of the country. After levelling out in September, average advertised rents in London grew by over £32 in October.
Throughout the first half of the year, both the South East and East Anglia experienced consistent growth in average advertised rents to the extent that they became a more viable and profitable alternative for investors than the London property market. While average rents in both of these regions remain strong, at £1,145 and £889 per month respectively, the markets appear to have settled somewhat as we approach the end of the year with minimal declines of 0.13% and 0.6%.
Throughout October we saw rents increase across the country as a whole, bolstered by surprising growth from the regions which have recently been in a period of general stability or gradual decline. The outcome of this growth has been a 0.75% increase in the average advertised rent across Great Britain, with average asking rents at £975 at the end of the month.
Elsewhere, rents in the East Midlands, North East and Wales saw healthy increases at the end of October with average asking prices rising by 4.31%, 4.19% and 3.94%.
Robin King, Director of Move with Us, commented: “The surprise for October has been the sudden growth of approximately £25 in the average rents in the East Midlands, North East and Wales. All three of these regions performed unimpressively over recent months and these unexpected peaks mean that the markets are expected to finish the year much closer to the advertised rents of October 2012, and in the case of the East Midlands, outperforming this level.
“The strong performance of these regions throughout October was contrary to the performance of other regions but has been significant enough to push the average for the country up, while many of the strong performing and established regions have actually witnessed a decline.”
*The 209% calculation is based on the average asking rent in Greater London being £2251.81, and the average cost of renting in all of the other regions minus London being £729.37. The difference between these two rents is £1522.44 which is approximately 208.73% (209% rounding up) more expensive than £729.37.
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Our methodology has been formulated in conjunction with economic research academics, and is based on the idea that weightings and conditions create a better representation of the market, whilst preventing outlying values from skewing the data.
The Move with Us Rental Index is based on a weekly snapshot of over 150,000 rental properties advertised on major portals across eleven regions in the UK. This allows us to base our analysis on upwards of 7.8 million data points annually, one of the largest samples available for a rental index. In statistics, it is generally considered that the larger the sample, the more accurate the results.
Our methodology breaks the sample down into different property types recording both the number and average rental prices advertised for each of these. Next we weight the rental values for each region and type using official property surveys from the English, Welsh and Scottish governments. This prevents skewing due to over-representation of certain areas in our own data set. We then run our index against a base date of 4 July, 2011.
Calculating the average
The mean is the most reliable method of calculating average prices, though it can be distorted by outlying data. To prevent this and ensure an accurate average, we have introduced several filters to eliminate noise from the data. We have done this by:
- Removing properties priced within the highest and lowest 1% of the dataset
- Eliminating properties that have been on the market for more than 20 weeks. This ensures that historical data is not over-represented
- Introducing a moving average function, which takes into account past and present averages to create a more representative trend
About Move with Us:
- Trusted by the UK’s leading mortgage lenders, house builders and probate practitioners, we are one of the leading residential property experts providing a broad range of services and tools to help consumers and businesses value, manage and sell their properties. The focus of our business is on providing high quality and innovative services to the property industry and consumers. We aim to do property, properly.
- We are the largest network of independent estate agents in the UK, with over 1,100 members. This ensures that we have access to the best local knowledge across the regions. Through this partner network alone, we manage more than 7,000 moves a year.
- We work with the best independent, accredited estate agents across the country, providing them with property instructions and conveyancing and moving services that add value, providing their customers with a smooth and efficient move.
- Move with Us has 11 years’ plus experience in panel managed conveyancing with more than 100 solicitors nationwide. We manage over 50,000 instructions per annum through our 400 agency partners.
- Move with Us has ten years’ experience assisting UK house builders with their part exchange activity and has rapidly grown to become the largest provider of part exchange management services in the UK.
- We are committed to analysing the housing market, identifying key trends and data to help our clients enjoy success in the current and future property market. Our residential market review is produced every quarter analysing over 3,800 property sales completed by Move with Us with data derived from around 750,000 property listings supplied by Home.co.uk.
- Move with Us is home to the UK’s largest Rental Index. Working together with an economist at the London School of Economics and Home.co.uk, the Move with Us Rental Index is based on a weekly snapshot of over 150,000 rental properties advertised on major portals across eleven regions in the UK covering England, Wales and Scotland.
- We provide free, impartial advice and tools to home buyers and sellers in the UK. Our experience spans across all property interests and we specialise in conveyancing, probate, developer, asset management, lender and rental management services.
- Our significant business growth has been recognised with a number of prestigious awards, including Deloitte’s top 1000 performing business in 2012; Grant Thornton top 100 businesses in Cambridge in 2012; the Telegraph Fast Growth List, 2011; The Sunday Times Profit Track 100 award in 2008 and 2009 and the Sunday Times Fast Track 100 award in 2005 and 2006.
- Founded in 1997, we are based in Cambridgeshire, England, and have approximately 300 staff.
- For further information, please visit: http://www.movewithus.co.uk and www.mwuplc.co.uk