Private rental prices paid by tenants in the UK rose by 1.4% in the 12 months to March 2020, unchanged since February 2020.
Private rental prices grew by 1.4% in England, 1.2% in Wales and by 0.6% in Scotland in the 12 months to March 2020.
London private rental prices rose by 1.2% in the 12 months to March 2020.
The Office for National Statistics (ONS) has released a public statement on the coronavirus (COVID-19) and the production of statistics; Measuring the data describes the situation in relation to the Index of Private Housing Rental Prices (IPHRP) (the price collection for this publication has been largely unaffected).
Private rental prices paid by tenants in the UK increased by 1.4% in the 12 months to March 2020, unchanged since February 2020. For example, a property that was rented for £500 per month in March 2019 that had a rent increase of the average UK rate would be rented for £507 in March 2020.
Growth in private rental prices paid by tenants in the UK has generally slowed since the beginning of 2016, driven mainly by a slowdown in London over the same period. Rental growth has started to pick up since the end of 2018, driven by strengthening growth in London.
In the 12 months to March 2020, rental prices for the UK excluding London increased by 1.5%, unchanged since February 2020 (Figure 1). London private rental prices increased by 1.2% in the 12 months to March 2020.
The Association of Residential Letting Agents (ARLA) reported in their Private Rented Sector Report, February 2020 that demand from prospective tenants fell in February but hit a record high for the month of February.
The Royal Institution of Chartered Surveyors' (RICS') March 2020 Residential Market Survey reported that tenant demand was more or less stable in the three months to March.
These supply and demand pressures can take time to feed through to the Index of Private Housing Rental Prices (IPHRP), which reflects price changes for all private rental properties, rather than only newly advertised rental properties.
Focusing on the long-term trend, between January 2015 and March 2020, private rental prices in the UK increased by 8.8% (Figure 2).
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In England, private rental prices grew by 1.4% in the 12 months to March 2020, unchanged since February 2020. When London is excluded from England, privately rented properties increased by 1.6% in the 12 months to March 2020.
Private rental prices in Wales grew by 1.2% in the 12 months to March 2020, unchanged since February 2020.
Rental growth in Scotland increased by 0.6% in the 12 months to March 2020, unchanged since December 2019. Scotland's rental growth has remained weaker than the rest of the UK since August 2016.
The annual rate of change for Northern Ireland in March 2020 (1.6%) is higher than the other countries of the UK. The Northern Ireland annual growth rate has remained broadly consistent (around 2%) since 2018, with December 2019 seeing the largest drop in the annual rental price growth between periods since the Index of Private Housing Rental Prices (IPHRP) began. Northern Ireland data have been copied forward since December 2019. The next update to Northern Ireland data will be in the June 2020 release.
All UK countries have experienced a rise in their private rental prices between January 2015 and March 2020, with rental prices in England and Northern Ireland increasing more than those in Wales and Scotland across the time series (Figure 4).
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Focusing on the English regions, the largest annual rental price increase in the 12 months to March 2020 was in the South West, at 2.4%, up from 2.3% in February 2020 (Figure 5). This was followed by the East Midlands, at 2.3%.
The lowest annual rental price growth was in the North East where rental prices increased by 0.7% in the 12 months to March 2020, followed by the North West, which increased by 1.0%.
Figure 6 shows the historical 12-month percentage growth rate in the rental prices of each of the English regions.
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Many private sector organisations, including estate agents and property companies, produce estimates of changes in rental prices. These include HomeLet, Rightmove, Zoopla, Countrywide PLC, LSL Property Services and Your Move. These sources provide an extensive range of rental data, but a closer look at these rental measures offers a diverse picture.
Historically, the rent increases calculated by the private sector measures have differed from those shown in the Index of Private Housing Rental Prices (IPHRP), and some tend to be more volatile. This is because the private sector measures primarily focus on newly let properties, while the IPHRP includes a mixture of newly let properties and existing lets. This is important, as evidence obtained from Valuation Office Agency (VOA) rental officers suggests that the greatest price rises occur when properties are newly let, compared with existing tenants, who tend to see smaller price increases.
Details on the research conducted by the VOA and further information on HomeLet, Rightmove, Zoopla, Countrywide PLC, LSL Property Services and Your Move and IPHRP data sources and their differences is available in the Private rental growth measures, a UK comparison: October to December 2019 publication.Back to table of contents
Index of Private Housing Rental Prices, UK: annual weights analysis
Dataset | Released 25 March 2020
Aggregate weights information used in the experimental Index of Private Housing Rental Prices (IPHRP).
Index of Private Housing Rental Prices, UK: monthly estimates
Dataset | Released 22 April 2020
Rental price index historical time series (index values and annual percentage change).
Index of Private Housing Rental Prices (IPHRP)
The Index of Private Housing Rental Prices (IPHRP) measures the change in the price tenants face when renting residential property from private landlords.
Administrative data are data that people have already provided to the government through day-to-day activities, for example, health records, social security payments or educational attainment information.Back to table of contents
The Office for National Statistics (ONS) is working to ensure that the UK has the vital information needed to respond to the impact of the coronavirus (COVID-19) pandemic on our economy and society; this includes how we measure the Index of Private Housing Rental Prices (IPHRP). At present, the price collection for this publication has been largely unaffected. The ONS remains committed to providing the best and most accurate information we can, serving the public good at a time when it is needed the most. As this situation evolves, we are developing several solutions to meet potential scenarios depending on the amount of data that is able to be collected by our data suppliers, and to consider how we produce forthcoming publications. Users will be informed of any changes to how the data are measured.
After EU withdrawal
As the UK leaves the EU, it is important that our statistics continue to be of high quality and are internationally comparable. During the transition period, those UK statistics that align with EU practice and rules will continue to do so in the same way as before 31 January 2020.
After the transition period, we will continue to produce our inflation statistics in line with the UK Statistics Authority's Code of Practice for Statistics and in accordance with internationally agreed statistical guidance and standards.
The IPHRP is constructed using administrative data. This means that the index makes use of data that are already collected for other purposes to estimate rental prices. The sources of private rental prices are the Valuation Office Agency (VOA), Scottish Government, Welsh Government and Northern Ireland Housing Executive (NIHE). Data for Northern Ireland also include data provided by Propertynews.com. Estimates are based on a known sample rather than a census.
The sources of the annually updated expenditure weights are the Ministry of Housing, Communities and Local Government (MHCLG), Scottish Government, Welsh Government, NIHE and the VOA.
The IPHRP's indices are updated on a monthly basis with the new monthly estimate. Data are indexed with January 2015 as a base year. Data for England are provided from January 2005, data for Wales from January 2009, and data for Scotland from January 2011. UK data are from January 2015.
More quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in the IIPHRP QMI.Back to table of contents
The Index of Private Housing Rental Prices (IPHRP) is constructed using large administrative sources, specified in Section 8: Measuring the data. Annually, over 450,000 private rental prices are collected in England, 30,000 in Wales, 25,000 in Scotland and 15,000 in Northern Ireland.
The index does not only measure the change in newly advertised rental prices but reflects price changes for all private rental properties.
The IPHRP is published as price indices, rather than average prices. It is also only published down to a country and regional level. While actual rental prices cannot currently be published in the IPHRP because of data access constraints, we are actively working to acquire the necessary data.
The IPHRP is released as an Experimental Statistic.Back to table of contents
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