High demand sees Northern Ireland rents rise faster than UK average
The average monthly rent in Northern Ireland has risen by more than the UK average to £629, according to a new survey.
The Homelet Rental Index has revealed that the average rent has increased by 2.4% since last year, compared to a rise of 0.9% elsewhere in the UK.
The average rent in the UK is now £912.
Richard McCulloch, managing director of McCulloch Estate Agents, said: "Rents are most certainly on the rise. My own findings here in Mid Ulster show that rents are up almost 5% on last year, which is due to a lack of supply of good properties and a huge demand from tenants.
"There is a very high supply of recently built homes in Magherafelt, but these are being bought by young professionals and second time movers, which means there really is no new supply of affordable houses for rent.
"As more workers keep coming into town and new first time buyers appear who are being priced out of the new builds, this leads to a bubble forming in the rental market.
"It's good for landlords but very bad for tenants as rents keep going up, stopping many people from saving for a deposit to buy their own home, keeping them in the vicious circle."
Rachel Skelton, office manager at Deborah Yea Partnership, in Carrickfergus, said she believed that landlords may have increased rents due to high demand.
She reported that the average cost of a private rental in the Co Antrim town was between £500 and £550 monthly.
"Rents have probably increased a bit because of the demand and there are not enough properties.
"So many people are looking to rent that landlords are putting on a bit extra and people will pay because the demand is there."
Overall in the UK, rents have risen by 0.9% in the last 12 months, equating to an average monthly increase of £3 per property. HomeLet Rental is the UK's largest tenant referencing firm. It provides comprehensive and up-to-date data on rental values in the UK.
Martin Totty, chief executive, said: "Rental price inflation was much more stable over the whole of 2017 compared to 2016, when rents rose at an annual rate of more than 4% in the first half of the year, before dropping back in the second half.
"So far, we are seeing this more stable market continue to prevail in 2018.
"During the first quarter of 2018, house prices across the UK rose by 2.7%, while the rental market increases have been nowhere near as significant, rising just 0.3% (from £909 to £912), showing much more stability, which has characterised the rental sector over a long period," he added.
Meanwhile, the average cost of a private monthly rent in the UK is £759 outside London.
Average rents in the English capital were £1,569, up by 1.5% on last year.
Rents in Scotland are showing the highest year-on-year increase at 5.6%.
However, the pace of rental inflation has slowed in Scotland and the North East.