Annual residential rental growth in London has fallen for the first time in six years, according to the latest Countrywide Monthly Lettings Index.
Residential rents in the capital fell by 0.5% in the 12 months to July, making the average rent £7 cheaper than at the same time last year.
It was the first year-on-year fall since November 2010.
Rents in the South East, Wales and Scotland also fell in the same period.
Across Great Britain, rents rose by 1.5%, the slowest rate of growth since 2012, although the Midlands saw a rise of 4.8%.
The volume of homes for rent in the UK was up by 23% from a year before, which has offset growing demand and slowed rental growth.
With more available homes, only 7% of tenants paid over the asking rent to secure a home, compared with 16% last year.
The fall was bigger in London, where 11% of homes were let for more than their asking price, down from 32% in July 2015.
Johnny Morris, director of research at Countrywide, said: “Stock levels were already running higher than usual due to investors bringing forward purchases in the rush to beat the stamp duty deadline in April. Added to that, uncertainty in the sales market in the run up to and after the EU referendum has caused more discretionary sellers to turn to the rental market.
“While rental price growth has slowed, current market dynamics are likely to accelerate the growth of renting. It seems that with more stock and demand from tenants we will see the number of households renting increase in 2016.”
Rental prices for new lettings
| Region | Ave Rent Jul-16 | Ave Rent Jun-16 | Ave Rent Jul-15 | July Rent YOY |
|---|---|---|---|---|
| Greater London | £1,280 | £1,294 | £1,287 | -0.50% |
| Central London | £2,638 | £2,448 | £2,583 | 2.10% |
| East of England | £963 | £978 | £928 | 3.80% |
| South East | £1,173 | £1,241 | £1,186 | -1.10% |
| South West | £856 | £831 | £829 | 3.30% |
| Midlands | £703 | £696 | £671 | 4.80% |
| North | £694 | £698 | £663 | 4.70% |
| Scotland | £689 | £710 | £696 | -1.00% |
| Wales | £671 | £700 | £685 | -2.00% |
| Total | £951 | £960 | £937 | 1.50% |
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