Rental Index Report. December Powered by MIAC. Statistics: December Key Feature: Rental increase and rail fare rise

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1 Rental Index Report December 2017 Powered by MIAC Statistics: December 2017 Key Feature: Rental increase and rail fare rise Analysis: The commuter cost of travelling to London Area Spotlight: Slough Rental Breakdown: Average rents across England 1

2 Statistics: December 2017 Average Rent in London vs Rest of UK Average Rental Price Rise Across the UK - Year on Year England 1, % 1,872 London 759 Rest of UK Tenants occupying properties in London are now spending an average of 1,872 on rent, whilst tenants outside the capital are paying 759 on average. Average Rent by No. of Beds London 1, % Scotland % ,448 1,918 2,671 Rental prices according to no. of beds Rental prices according to no. of beds London Rest of UK Wales % Northern Ireland % Tenants occupying properties in London are now spending an average of 1,448 on rent for 1-bedroom properties, 1,918 for 2-bedroom properties and 2,671 for 3-bedroom properties. Conversely, tenants occupying properties in the rest of the UK are paying an average of 599 on rent for 1-bedroom properties, 714 for 2-bedroom properties and 827 for 3-bedroom properties. Since December 2016, average rents in the UK have risen by 0.56% to 1,196. In England, rents were up by 0.50% to 1,227/ month; in London, rents fell by -0.80% to 1,872. In Northern Ireland, rental prices rose by 0.75% to 563/ month. Meanwhile, in Scotland, rents grew by 1.18% to 729/ month; in Wales, the average rent rose by 1.36% to

3 Key Feature: Rental Increase and Rail Fare Rise Commuters face rental increase amid rail fare price rise London commuters were faced with an unwelcome surprise at the beginning of January, as they stepped back into work to the tune of a 3.6% rise in season ticket prices across the whole of the UK. The fare increase is the largest of its kind since 2013 and comes as rents in the most popular commuter towns also experience significant growth, increasing the overall financial burden for tenants working in the city. Of the total London commuter hotspots found in the or South of England, 17 towns were hit with the double blow, as extra annual expenditure of rail fares surpassed spending on higher rents. On average, rents in these areas rose by 183 (1.68%) in the year up to December In combination with the added cost of rail travel, commuters in these regions are facing a total additional average expense of 325/ year. Cambridge and Brighton have seen the greatest monetary rise in rents, 228 (2.06%) and 202 (1.58%) respectively, as rail fares in both regions rose by 172 and 163. Meanwhile, commuters living in Guildford, Reigate and Woking, all saw rents fall by 127 (-0.73%) in This will be saving enough to offset the rail fare hikes of 126, 99 and 113 respectively. Those in Aylesbury and High Wycombe (-43) and Slough (-4), have also made rent savings, but hardly enough to chip away at the 141, 124 and 91 increase to train fares. There are now signs that demand for low-rent accommodation by long-distance commuters to London is pushing up rents in these areas. 31 of the 40 most popular commuter routes have seen rents rise by more than the UK average of 0.56%, and by as much as 2.15% in Southend on Sea and 2.06% in Cambridgeshire. John Goodall, CEO and founder of Landbay said: Commuters have seen their season ticket prices rise by more than 100 this week, the majority of whom are also looking at a double whammy of rent rises driven by greater tenant demand. At a time when rents in the capital are falling, some may even be considering a move into London, to be done with the train commute altogether. With inflation riding so high, rail fare growth shows no sign of slowing, and without a radical house building plan for purchase as well as purpose-built rental properties, rental price growth is expected to accelerate this year as well. 3

4 Analysis: The Commuter Cost of Travelling to London Top 8 London commuter stations with the greatest increase in annual season ticket price Southampton Central Milton Keynes 2018 Price () 5, Price () 5,209 Increase from 2017 () 198 Increase from 2017 () 181 Average Rent Month () 763 Average Rent Month () 932 Southampton % Change 0.75 % Change 0.60 Milton Keynes Canterbury Stations Hastings 2018 Price () 5, Price () 5,159 Increase from 2017 () 188 Increase from 2017 () 179 Average Rent Month () 916 Average Rent Month () 781 Kent % Change 1.54 % Change 1.86 Sussex Ashford International Oxford 2018 Price () 5, Price () 5,097 Increase from 2017 () 187 Increase from 2017 () 177 Average Rent Month () 916 Average Rent Month () 1,191 Kent % Change 1.54 % Change 0.66 Oxfordshire Portsmouth Stations Colchester 2018 Price () 5, Price () 5,105 Increase from 2017 () 182 Increase from 2017 () 177 Average Rent Month () 864 Average Rent Month () 955 Portsmouth % Change 0.88 % Change 1.71 Essex Prices are for the cheapest available 12-month season ticket into London terminals on any route permitted (where available) excluding use on high speed services. 4

5 Analysis: The Commuter Cost of Travelling to London Bottom 8 London commuter stations with the greatest increase in annual season ticket price Southend Central Reigate 2018 Price () 3, Price () 2,847 Increase from 2017 () 123 Increase from 2017 () 99 Average Rent Month () 756 Average Rent Month () 1,431 Southend on Sea % Change 2.15 % Change Surrey Sevenoaks Brentwood 2018 Price () 3, Price () 2,673 Increase from 2017 () 122 Increase from 2017 () 93 Average Rent Month () 916 Average Rent Month () 955 Kent % Change 1.54 % Change 1.71 Essex St Albans city Slough 2018 Price () 3, Price () 2,631 Increase from 2017 () 122 Increase from 2017 () 91 Average Rent Month () 1,145 Average Rent Month () 961 Hertfordshire % Change 0.68 % Change Slough Woking Grays 2018 Price () 3, Price () 2,379 Increase from 2017 () 113 Increase from 2017 () 83 Average Rent Month () 1,431 Average Rent Month () 955 Surrey % Change % Change 1.71 Essex Prices are for the cheapest available 12-month season ticket into London terminals on any route permitted (where available) excluding use on high speed services. 5

6 Area Spotlight: Slough The South- Tenant Saver Situated in the county of Berkshire, rents in Slough have been rising consistently over the past few months as more tenants move into the area. Interestingly, despite bordering high-rent areas, such as Maidenhead and Reading, and existing as a stopping point on the Crossrail route, prices in Slough remain some of the lowest in the South- at 961/ month, almost 90 cheaper than the average rent in the region. Out of all the London commuter stations, Slough has incurred the smallest increase in annual season ticket prices of all areas in the South-, at 2,631. This is an increase of 91. However, in December 2017 prices here have also fallen by -0.04%, meaning that for tenants, the increase in rail travel is less of a blow here than for other towns in the same region. Currently, average rents in Slough are almost 80/ month cheaper than the regional average at 961/ month. For one-bedroom properties tenants can expect to pay an average of 814/month, for two-bedroom properties this increases to 1,046 and for three-bedroom properties average rents sit at 1,297. 6

7 Rental Breakdown: Average Rents Across England Areas with the Highest Rents England, by County Region Area Average % change (YoY) Average Rental price () Rental prices by beds () South Surrey -0.73% 1, ,190 1,545 North Tyne & Wear 0.75% North Cheshire 0.73% South Bath and North Somerset 2.29% ,190 of England Hertfordshire 0.68% 1, ,108 1,444 Midlands Northamptonshire 2.94% Midlands Warwickshire 2.09% Yorkshire & Humber York 1.25% London Kensington & Chelsea -1.25% 3,045 2,134 3,233 5,446 7

8 Rental Breakdown: Average Rents Across England Areas with the Lowest Rents in England, by Region Region Area Average % change (YoY) Average Rental price () Rental prices by beds () South Isle of Wight 2.16% North Hartlepool -0.29% North Blackburn with Darwen 0.06% South Torbay 1.28% of England Peterborough 2.73% Midlands Derby 1.96% Midlands Stoke on Trent 2.00% Yorkshire & Humber Kingston upon Hull 0.56% London Bexley 1.12% 1, ,298 8

9 About Rent Check & the Landbay Rental Index Rent Check is an online tool that allows tenants and landlords to validate movements in their own rents against others in their area in a fast and user-friendly way. The postcode search widget harnesses sophisticated UK wide data from Landbay s monthly Rental Index, powered by MIAC. The index maps annual and monthly trends in advertised and actual rents, both geographically and by bedroom number, providing unique and sensitive insight into market movements and social mobility. To validate your rent change by area and number of bedrooms, please visit rentcheck.landbay.co.uk The Landbay Rental Index The Landbay Rental Index includes unique granular level detail, looking at local trends to the county and London Borough level, including further segmentations by number of bedrooms. The credibility of any index is highly dependent on the breadth and depth of underlying data used, which is why this rental index utilises data from Zoopla, the British property website. Approximately 100,000 properties are analysed each month to form the index. The rental values are mix adjusted by property type, number of beds and geography to ensure that any change in the composition of the data over time does not skew the results. The changes in rents are calculated based on matched samples of homogenous or identical data points over time. MIAC employs sophisticated smoothing techniques and interpolation to filter noise and optimise the signal from the data. Landbay and MIAC do not make any declaration regarding the accuracy or completeness of the Rental Index; collectively reserving the right to adjust the methodology and to edit or withdraw any reports or data. Landbay and MIAC shall not be liable for any decisions made or action taken in response to the published data. 9