What the ONS published

On 16 September the Office for National Statistics published its monthly private rent and house price figures. The average UK rent reached £1,400 a month in August, 3.8% higher than a year earlier and up from 3.7% in July. In England the average is £1,459, up 4.0%.

The regional split is where the story is. The North West and the North East both recorded annual rent growth of 5.8%, the joint fastest of any English region, and the North West rate is still climbing, up from 5.7% in July. London sits at 3.5% and the South East at 3.0%.

Prices are moving the same way

The house price data, which runs a month behind, tells a matching story. The average UK price in July was £273,000, up 1.4% over the year. The North East leads every English region at 4.9%, while London is the weakest at minus 3.3%, with an average price of £569,000.

For anyone building a portfolio, the comparison is stark. A buyer in the North pays well below the London average of £569,000 and, on the latest official data, collects faster rent growth as well.

Why the northern figures carry weight

  • This series moves slowly. Unlike portal asking rents, the ONS measure includes rents on tenancies already in place. When it accelerates, the change is broad across the market rather than a burst of new listings.
  • Growth is starting from an affordable base. Average London rent is £2,332 a month. Northern rents remain far below that, so a 5.8% rise adds far fewer pounds a month for a tenant than the same percentage would in the capital.
  • The North West is still gaining pace. Its rate rose again in August while the North East eased slightly from 6.3%, so the regional lead is not a single-month spike.

How we are positioning

Our northern stock is concentrated in Manchester and Liverpool, and this is the data that underpins it. We underwrite every deal on the rent a property achieves today, not on the 5.8% headline, but sustained regional growth of this kind is the margin of safety we want on top. For clients choosing between regions, we compare net yield after costs side by side rather than headline price. Our Manchester investment guide and Liverpool investment guide set out the current numbers by area.

The bottom line

The North West and the North East are growing rents faster than any other English region, from a far lower entry price than London, and the North West is still gaining pace. For an investor who wants rising income without a London price tag, the North is where the official numbers point.