Average UK rents climbed 3.8% in 2015, twice as fast as wages, new research shows.
This was largely down to the housing shortage which saw rental increases outpace wages in all parts of the UK except the North East and North West, according to the monthly Landbay Rental Index.
Average monthly rents ended 2015 with a slight seasonal dip of -0.2% from £1,289 in November 2015 to £1,286 in December 2015.
Annual rental growth of 3.8% in the year is twice as fast as wage growth, which climbed 1.9% in 2015.
John Goodall, co-founder of Landbay, said: “Despite a small seasonal dip towards the end of the year, rents rose significantly ahead of wages in 2015.
“Rents often track wages as consumers with more pay compete for the most desirable rental properties, but the fact that rents are outpacing wages is a clear sign of the shortage in properties to rent as large parts of the UK face an acute housing shortage.
“This trend is clear in London and the South East, along with large parts of the East Midlands and East Anglia, and it is most evident for three-bedroom properties.”
Goodall warned that new taxes on buy-to-let suggest the Government is intent on weeding out amateurs from the ranks of new buy-to-let investors.
“If it is successful, our rental index suggests that the result is likely to be higher rental income for the professional investors who are not impacted by the changes,” he said.