Forget the south of England. The best places to let property are now in northern towns and cities, according to new research from Rightmove, which analyses asking rents outside London.
Data from the property website shows that northern towns and cities now dominate the top ten places where asking rents have increased the most – excluding the capital – since July 2018. So if you want to get the best return on your investment, where are the best places to buy rental property?
Pudsey topped Rightmove’s table for highest rental growth. Tenants in the West Yorkshire town can now expect to pay around £680 per calendar month. That’s a 12% hike from £607 pcm a year ago. Commenting on being placed at the top of the leader board, John Sheader, lettings manager of Manning Stainton in Pudsey, said: “It’s booming in Pudsey; as an area it’s really close to Leeds and …with people who work in the city moving to Pudsey, the demand has increased and so its prices have been playing catch-up. It’s only 15 minutes from Leeds city centre by car, and even quicker by train – Pudsey has a station with direct access into Leeds. It’s the perfect location for younger people.”
Pontypridd in Wales was second in the table, with Bury in Greater Manchester coming in third. Both towns have witnessed year-on-year asking rent increases of 9%.
Esher in Surrey was the only place from the south of England to make the top ten, with average asking rents rising 8% from £1,614 in July 2018 to £1,743 in July this year. The west London suburb is also home to the highest asking rents outside the capital.
In Scotland, the highest rental growth was in Stirling. Average asking rents increased in the city by 7% from £658 to £707 pcm between July last year and July 2019.
Rightmove’s Rental Trends Tracker for Q2 2019 also reveals that around the country (excluding London) asking rents stand at a record high of £817 per month, running at 2.7% up on a year ago as rents continue to steadily rise.
Demand from tenants looking for a new home increased 7% between May and June, an uplift seven times bigger when compared to the previous four-year average of just 1% at that time of year, as tenants waited to move until after the fees ban came into force in England on 1 June.
Rightmove’s property expert Miles Shipside believes a range of drivers are pushing rents to a new record high. Fewer landlords – as some have exited the market due to more punitive taxes – have combined with lower tenancy costs to create higher demand for rented homes. “It’s the more northerly locations that have driven this increase and they dominate the top ten hotspots when you exclude the capital’s more rarefied market,” he says. “These rent jumps are good news for landlords who have ridden out the tax hikes, though they may cause some tenants to falter after the initial excitement of the potential of upfront savings under the tenant fee ban.”
Top ten rental hotspots (for two-bedroom properties):
|Rank||Location||Average asking rent (July 19)||Average asking rent (July 18)||% change|
|4||Newcastle Upon Tyne||£701||£644||9%|