Residential rental rates fall in North-West
Monthly rents for residential properties have declined most noticeably in Yorkshire and in the North-West more generally, due primarily to the fact that developers have increased the supply of flats to a point where they exceed demand. In fact, rents have fallen most dramatically in Liverpool and Manchester, where the monthly rate dropped by 15.7 percent in a single year. As such, the average rent in these two northern cities now stands at approximately £580 a month. Regionally, rents dropped by 7.9 percent in Yorkshire, while landlords in other parts of England—including the West and East Midlands—experienced much lower rental declines, of between 3 percent and 6 percent. Landlords in the North-East have been most fortunate over the past year, with rents dropping by a modest 0.8 percent.
The striking difference between rental rate declines shows that looking at national figures is of limited use, as there are major discrepancies from one region to another. Buy-to-let sector specialists point out that this has to do with the fact that developers have been especially active in Manchester and Liverpool, where rental declines have also been the most pronounced. In fact, fully 50 percent of all new residential properties constructed over the past two years in Britain were flats, which were often rented due to the difficulty of obtaining mortgages. Landlords who have been hard hit in these two cities, however, can expect rents to stabilize over the next two years, as major developers—including Barratt Homes and Taylor Wimpley—will decrease the proportion of flats constructed to under 30 percent of all residential properties.