LONDON — Average monthly rent in Britain was £5 lower in February than a year before, marking the first decrease since 2011, according to figures from real estate agents Countrywide.
Average rent in the UK fell to £921 a month in February. Rents fell fastest in London and were down by £63, or 4.3%, to £1,246 a month.
Fears over the effects of Brexit on the nations financial capital, combined with a sudden supply glut, pushed prices down.
Johnny Morris, research director at Countrywide, said: “Economic and housing sentiment — both in sales and rental markets — has been affected by our vote to leave the EU, in London more than anywhere else.
“This uncertainty causes tenants to be more cautious, meaning less likely to move and more likely to look for cheaper accommodation, e.g. sharing,” he said, according to The Guardian.
The supply of new homes to let in London rose 18% after investors snapped up properties to let before a rise in stamp duty last year. The number of potential tenants fell by 3%
“Early signs point towards 2017 being a rare year where rents rise faster in the north of the country than in the south. While rents are likely to track any increase in earnings, affordability in London and the South East remains stretched. That is likely to limit rental growth,” Morris said.
The UK is becoming a nation of renters. Earlier this month a government study showed that home ownership in England has fallen to its lowest level for 30 years, while the private rental sector has doubled in size since 2004.
Just under 63% of homes were inhabited by owner-occupiers in 2016, figures from the English Housing Survey showed, which is the lowest level since 1985.
The combination of a housing shortage and years of near-zero Bank of England interest rates have sent house prices soaring, and made stumping up the money for a deposit more difficult.
The private rental sector has boomed as a result, with almost half of all people in England aged 25 to 34 paying a landlord. Around 250,000 private renters entered the market in 2016, with the sector now accounting for 20% of all accommodation.
Here is the home ownership chart:
NOW WATCH: The boss of 30,000 people shares how you can get a promotion at work by asking but without bragging
Business Insider Emails & Alerts
Site highlights each day to your inbox.