Yahoo Finance UK tenants hit by rising rents amid house price increase
UK house prices increased by 6.3% in the 12 months to January, bringing the average UK house price to £290,000 in January, according to the Office for National Statistics (ONS).
Tenants are being hit by rising rents, with private rental prices paid in the UK jumping by 4.7% in the 12 months to February 2023.
It is the largest annual percentage change since the data series began in January 2016.
Looking at it by nation, annual private rental prices increased by 4.5% in England, 4.2% in Wales and 4.9% in Scotland in the year to February 2023.
Within England, the East Midlands saw the highest annual percentage change in private rental prices in February 2023, up 4.9%, while the West Midlands saw the lowest at 4%.
Read more: Inflation rate in surprise jump to 10.4% amid record food costs
London’s annual percentage change in private rental prices was 4.6%. “ This is the strongest annual percentage change in London since January 2013,” the ONS said.
Today’s @ONS data reminisces on AVG house price in Jan 23 which were £289,819. On a non-seasonally adj basis, this was a dec of 1.1% between Dec 2022 & Jan 2023. Down from an inc of 1.7% during the same period 12mths ago. Signalling this years, about-turn on Pandemic gains pic.twitter.com/UbbFHPWkgK
— Emma Fildes (@emmafildes) March 22, 2023
Average house prices increased over the 12 months to £310,000 (a 6.9% annual increase) in England, £217,000 in Wales (5.8%), £185,000 in Scotland (1%) and £175,000 in Northern Ireland (10.2%).
Nathan Emerson, Propertymark chief executive, said: "The ONS’s latest data reflects on deals agreed around the time of the disastrous mini-budget and more up-to-date data coming from the market and the wider economy paints a more positive picture.
“In January, our member estate agents reported that the market had picked up pace with sales agreed up 50% cent from December. Serious buyers are still very much in the market and with more homes are coming up for sale, competition is considerably lower. Therefore, prices are returning back to far more sustainable levels than seen previously.”
Karen Noye, mortgage expert at Quilter, added: “The ongoing cost of living crisis and increased energy bills have had a significant impact on the housing market, as did the fallout of the ill-fated mini budget, but the market has so far been more buoyant than predicted. While we have seen a dip in prices in recent months, the dramatic fall that had been rumoured is yet to materialise and the slightly more stable mortgage market could see it held off for the time being.
Read more: Six ways to bring down costs on rising mortgage rates
“However, the current economic circumstances mean we are unable to rule out further turbulence in the housing market. This morning’s UK inflation data show the UK’s battle with inflation will not be smooth sailing, as CPI unexpectedly rose to 10.4% rather than falling to single digits as had been hoped. This leaves the Bank of England in a difficult position as it may not yet be able to press pause on rate hikes, though positively for house buyers fixed-rate mortgages are likely to continue on their downward trend even if the Bank does opt to raise rates further.
Watch: How much money do I need to buy a house?
Download the Yahoo Finance app, available for Apple and Android.
