Countrywide forecasts that next year, for the first time, more homes could be let than sold
Rental growth has slowed across most of Britain over the last year, but rents are still rising rapidly in the north, Countrywide reported this morning.
The firm also forecasts that next year, for the first time, more homes could be let than sold.
Of the 20 largest cities, the five which have seen the cost of a new let rise the fastest are all in northern England or Scotland.
Manchester has seen the highest growth, with the rents of new lets rising 7.1% over the last year, faster than anywhere else in the country and more than three times faster than the average.
York, Leeds, Liverpool and Glasgow make up the rest of the top five.
Most southern cities have seen rental growth slow over the course of 2016.
Oxford, Cambridge and London have seen the largest slowdown in growth and all drop at least five places from last year.
In the capital, rents are rising fastest in outer London, while across central and inner London they remain broadly unchanged on last year.
The proportion of landlords cutting the asking price rent has doubled over the last 12 months in cities in southern England.
A spike in the number of homes available to rent since April’s Stamp Duty change has given tenants more choice, increased competition among landlords and slowed the rate of rental growth, said the firm.
Johnny Morris, research director at Countrywide, said: “A different type of two-speed rental market is emerging, with falling stock and growing demand driving rental growth in many northern cities at a higher rate than those in the south.
“With London rents growing at the slowest rate since the downturn of 2008 and northern cities recording rent rises three times as large as their southern counterparts, there are signs that the north-south rental divide is starting to close.
“However, at current rates it would take at least five years for the gap between rents in the south and north to close back to 2010 levels.
“As some would-be buyers and sellers sit on their hands, Brexit-induced uncertainty has continued to boost to the rental market.
“Overall this is yet to stoke rental inflation, but September saw record activity, with increasing numbers of lets agreed and tenants choosing to renew their contracts.
“On current trends, 2017 could be the first time since the 1930s that more homes are let than sold.”