There was a small dip in December, when average rents dropped by a marginal 0.2% to £1,286, but this was an expected seasonal trend. Over the course of the year rents were up almost 4%, twice as fast as wage growth, which was just 1.9% last year.
A shortage of housing meant that rental increases outpaced wages in all parts of the UK except the North East and North West.
In the East of England, stagnant wage growth of 0.1% combined with rapid rent rises meant that rental growth outpaced wage growth by over 5%.
Commuter hotspots surrounding London saw the greatest rises in rental prices. Rents shot up by 11.1% in Luton, 8.8% in Medway and 7.3% in Thurrock, indicating that many working in the capital are priced out of living there. The ripple effect meant that counties to the North, East and South of London all showed higher than average increases in rental prices during 2015.
John Goodall, co-founder and CEO of Landbay, said: “Rents often track wages as consumers with more pay compete for the most desirable rental properties, but the fact that rents are outpacing wages is a clear sign of the shortage in properties to rent as large parts of the UK face an acute housing shortage.
“This trend is clear in London and the South East, along with large parts of the East Midlands and East Anglia, and it is most evident for three bedroom properties.”
