Average private rents increased by 8.7% in the 12 months to October 2024, up from 8.4% in the 12 months to September 2024, the latest data from The Office for National Statistics (ONS) has revealed.
Regionally, average rents increased to £1,348 (8.8%) in England, £766 (7.9%) in Wales, and £976 (6.6%) in Scotland during this period.
In Northern Ireland, average rents increased by 9.0% in the 12 months to August 2024.
What’s more, rents inflation was highest in London (10.4%) and lowest in Yorkshire and the Humber (5.9%).
Average house prices increased by 2.9%, to £292,000, in the 12 months to September (provisional estimate); marking a growth rate increase of 2.7% in the 12 months to August.
Average house prices increased in England to £309,000 (2.5%), in Wales to £217,000 (0.4%), and in Scotland to £198,000 (5.7%) throughout the month.
Reaction:
Alex Upton, managing director, specialist mortgages and bridging at Hampshire Trust Bank:
“Rents have risen substantially over the past year, and the latest Office for National Statistics data confirms it.
“Demand for rental properties continues to outstrip supply, and we’re likely to see this trend drive rents even higher in the coming months.
“Propertymark’s figures show there are around 10 prospective tenants for every rental property available through the average letting agent.
“Unless there’s a meaningful increase in supply—which isn’t on the horizon—this competition will keep pushing rents up.
“The uncertainty around the Budget made some investors pause, waiting to see if any tax changes would impact their plans.
“Now that the Government’s intentions are clear, and with the Bank of England’s recent base rate cut, investors have the clarity they need to pick up those paused deals.
“I expect we’ll see a renewed push in buy-to-let activity as landlords look to meet the strong demand in the rental market.”
Nick Leeming, chairman of Jackson-Stops:
“Today’s figures, running 6 weeks behind reality, offer an air of calm confidence.
“The late Autumn Budget spurred buyers to push completions over the line before any policy changes could disrupt the status quo.
“No doubt investors who were nervous about possible Stamp Duty and Capital Gains Tax rumours were pushing for transactions to complete before the end of October.
“This practical perseverance is evident across the Jackson-Stops network, with instructions steady and a slight increase in prospective buyers on an annual basis.
“Areas such as Chichester, Ipswich, Northampton, Sevenoaks, and Woburn all saw a bounce in instructions in October, but demand in these areas from new buyers far exceeds new listings.
“The hope is that the Government’s commitment to build more than a million new homes does help to address this supply shortfall but not at the expense of market confidence.
“As well as the lack of stock, what will hold buyers back is mortgage affordability.
“Despite the base rate being cut to 4.75%, this reduction is not yet feeding through into mortgage rates due to external headwinds.
“But the market should take confidence from the fact that activity levels are up year on year.
“As we approach a traditionally quieter period, the market can take comfort in a much more resilient and certain ending to 2024 than much of this year had suggested.”
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts:
“With house prices holding fairly steady and sellers more realistic about pricing, it could be the nudge buyers need to act.
“In saying that, mortgage rates remain high and that will impact buyers’ decisions, perhaps deciding to wait until they come down again.
“However, first-time buyers don’t have the luxury of delaying a move as they could potentially save thousands of pounds in Stamp Duty if they transact before 31 March.
“As we head towards the end of the year, we expect lower transaction levels due to affordability pressures and buyers taking longer to commit.
“The exodus of landlords, driven by tax and regulatory changes, has dampened activity in the buy-to-let sector, impacting overall market turnover.
“In areas where stock is limited, markets will have remained steady, particularly the family home market with work-from-home potential.
“Homes that are well priced and well presented in the Richmond Borough are still selling relatively quickly and the same will likely be the case in other desirable parts of the country.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman:
“At first glance, these figures show the housing market to be demonstrating continuing resilience.
“However, while this is the most comprehensive of all the price surveys as it includes cash and mortgaged transactions, it reflects buyer and seller decision-making from a few months ago at least.
“On the ground since, we have had to contend with worries about the Budget and then its fallout.
“The result has been more caution and heavier negotiation over available properties, despite the recent drop in mortgage rates.
“Worries remain about the pace of further falls in rates and increases in inflation as buyers want to ensure they have a sufficient buffer against potentially rising costs.”
Tomer Aboody, director of specialist lender MT Finance:
“We are seeing lower sales volumes in England which in turn are pushing buyers to pay slightly higher prices, and increasing the national average property value.
“Although transaction volumes are lower than in the past, they’re rising as rates are reducing or holding at reasonable levels, offering buyers more affordable finance options.
“With the Budget behind us and no help or push from the Government, any hope of assistance in the future is dwindling although the market is still hopeful of a further interest rate reduction, which will provide a boost.”
Malcolm Webb, risk director at Legal & General Surveying Services:
“These latest figures show the housing market is holding strong and that the pent-up demand for properties has found an outlet.
“As we move on from the pre-Budget uncertainty, confidence in the market should continue to grow.
“Challenges still remain – the upcoming March 31st deadline for Stamp Duty Tax Relief may cause a rush of market activity – but there is cautious optimism among brokers and lenders for 2025.
“The slower festive period may provide an opportunity for aspiring buyers to plan ahead and contact a professional adviser for guidance and support.”
Holly Tomlinson, financial planner at Quilter:
“The latest UK House Price Index for September 2024 reveals that house prices have fallen by 0.3% month-on-month, yet annual growth remains positive at 2.9%, bringing the average UK property value to £292,000.
“This slight dip reflects the usual seasonal slowdown, but also hints at growing caution among buyers and sellers amid ongoing economic and policy uncertainty.
“Regionally, the picture remains varied. The North East continues to lead the way with annual price growth of 6.5%, driven by affordability and demand, while London lags behind with a 0.5% annual decline, underscoring the challenges in high-cost areas.
“Affordability remains a key theme throughout the market, but first-time buyers face a particularly challenging landscape, with prices for starter homes rising annually but falling slightly month-on-month, reflecting squeezed budgets and elevated mortgage costs.
“With rates having gone up in the last few months despite a cut to the base rate first time buyers continue to have the rug pulled from beneath them.
“With the Bank of England recently cutting interest rates, there is cautious optimism that affordability may improve for some buyers in 2025.
“However, with a new president in the US whose policies could prove inflationary and just today the news that UK inflation as edged up again we still don’t have economic certainty.
“As such elevated mortgage rates underline the importance of seeking advice to navigate an increasingly complex housing market.”
Sarah Coles, head of personal finance, Hargreaves Lansdown:
“Renters are stuck in an endless cycle of rising costs. It’s forcing more to consider living somewhere smaller, in a worse area, or further from work, in order to make ends meet. Meanwhile others are considering moving back into shared accommodation.
“The immediate future looks tough enough, as rents continue to spiral, but what’s worse is that there’s no clear signal that this is ever going to end.
“Landlords are still leaving the market, and the Budget made things even worse, with a higher Stamp Duty surcharge loaded on top of frozen income tax thresholds, stricter legislation and higher mortgage rates.
“The RICS residential market survey for October showed the most negative figure for new rental properties coming to market since the end of 2021.
“As a result, getting good news about your rent is about as common as discovering your housemates have washed up for you, or your landlord suggesting you get a dog.
“It means for many, the only way out of the endless cycle of rising costs is to buy, but this is far easier said than done when rents absorb so much of your income.
“The HL Savings & Resilience Barometer found that renters spend an average of 36% of their household income on essential housing costs – including the rent, council tax and energy bills. It means it’s difficult to cover the rest of their everyday costs – let alone save for a deposit.
“They need all the help they can get, whether that’s from family helping out or taking advantage of free money from the Government through a Lifetime ISA.”
