Average UK rents outside of London increased by 2.3% in 2020, up from 1.6% annual growth in Q3 2020. This rental growth was underpinned by the continued rise in demand, up 21% year on year in January in UK rental market excluding London. In contrast, average annual rents are down -8.3% in London, with rental declines concentrated in inner London amid rising supply and weaker demand.
Some larger cities including Manchester and Birmingham are also registering rental declines of -0.9% and -0.8% respectively, although the ‘search for space’ ethos is driving demand in the wider commuter-zones surrounding these cities, creating an upwards pressure on rents.
Rental values in 2021 set to be underpinned by constrained supply in many markets. The outlook for city centre markets is dependent on effective rollout of COVID-19 vaccine allowing return to ‘business as usual’ and kick start a return to more mobility across the country, and internationally.
This content was taken from Zoopla’s, UK Rental Market Report Q4 2020