UK rents show steep rise outside of London

Key insights for expat mortgage seekers

Rents advertised for tenants outside London have hit a new record average of over £1,300 per month, according to data from property portal Rightmove. This represents a 7% increase compared to last year, far outstripping the current inflation rate of 2%, resulting in significant real income growth for landlords.

Online expat buy to let mortgage broker, Offshoreonline, confirms that such rental growth is typically indicative of a supply shortage, which has been a persistent issue. “We observed strong growth at the start of the year as the possibility of mortgage rate cuts became more feasible,” commented Guy Stephenson, a director at Offshoreonline. “Although demand dipped following the UK election announcement, political stability has now reignited interest in expat buy to let mortgages. Clients are increasingly looking to expand their portfolios or begin investing, viewing stock markets as either too risky or overvalued,” added Stephenson.

Rightmove’s data also highlighted that London rents experienced a significant surge at the end of the pandemic, with an 18% increase in a 12-month period. While this growth has now stabilised at around 4% p.a., it still remains comfortably above current inflation. The average advertised rent in London is now over £2,600 per month.

Other regions also showing substantial increases in rental returns include North East England (11%), West Midlands (10%), and Scotland (9%). The industry body Propertymark reports that letting agents had an average of 97 tenants registered in May, up from 90 in April.

Stephenson believes that with lenders poised to cut expat buy to let mortgage rates and a healthy supply of new properties, expat buy to let investors are set for a significant surge in activity.

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