Rents in London rise by 11.6%

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Rents in London rose at their fastest pace on record in November, according to official data highlighting the growing pain experienced by renters after two years of rising costs.

Rentals in London The unemployment rate rose by 11.6% in the 12 months to November 2024, the fastest annual pace since records began in 2006, the Office for National Statistics said on Wednesday.

The average monthly rent in London has surpassed £2,200 for the first time, pushing the UK average to more than £1,300.

Driven by London, annual rent growth in the UK also accelerated to 9.1 per cent in November, up from 8.7 per cent the previous month, and just below the record 9.2 per cent increase recorded in March 2024.

Andrew Montlake, managing director at mortgage broker Coreco, said: “The rent is nothing short of brutal. You have to feel for renters in the UK where rents are rising at an astronomical and unsustainable rate.

He added that the rapid pace of rent growth in London meant that “something has to go down”.

Rents have risen sharply over the past two years, as landlords outpace rising costs, amid a shortage of properties for rent and strong demand from renters who cannot afford higher mortgage payments.

However, a survey of estate agents published last week showed expectations for rental growth over the next three months Reduced in November With declining demand.

ONS rent data collects both existing and new rents, meaning it may take longer for turning points to emerge.

The Office for National Statistics also reported on Wednesday that UK house prices rose by 3.4 per cent to an average of £292,000 in the 12 months to October, compared to 2.8 per cent in the previous month, continuing the expansion seen. Since spring.

House prices contracted through 2023 and into 2024, reflecting the impact of higher Bank of England interest rates on mortgage costs.

Mortgage rates have fallen from their peak in the summer of 2023, but have risen again in recent months as the government’s October budget created upward pressure on the already accelerating inflation rate.

Earlier on Wednesday, the Office for National Statistics reported The inflation rate rose to 2.6 percent in November from 2.3 percent the previous month, the highest rate since March. Combined with strong wage growth, this has reinforced market expectations that the Bank of England will not cut interest rates when it announces its decision on Thursday.

“The decline in interest rates that has boosted house price inflation is likely to stall now that markets expect the MPC to ease policy only gradually in the wake of budget inflation and especially after the acceleration of Wage growth yesterday.

“This will not derail house prices, but it may dampen some of the strength of the recovery.”