Average UK rents fall for first time in six years amid Brexit uncertainty

Rents in Britain have fallen for the first time in six years, dragged down by a drop in the cost of tenancies in London and south-east England amid the uncertainty over the future of the UK outside of the EU, according to figures by real estate agents Countrywide.

The average new tenancy in England, Wales and Scotland fell 0.6 per cent or £5 in the year to February, to £921 a month. Rents fell the fastest in London, down 4.7 per cent to £1,246 on average.

Countrywide said the decline was mainly due to a surge in rental properties arriving on the market last year. That was due to some landlords rushing to buy last year before a 3 per cent stamp duty surcharge came into effect.

Johnny Morris, research director at Countrywide, said fears over the effect of the Brexit vote also had an impact on rents.

“While the fall in London tenant numbers cannot be directly attributed to the vote to leave the EU, the referendum has undoubtedly led to economic and housing uncertainty which have played a part in driving sentiment in not just the lettings, but sales market too.

"London has clearly taken the brunt with tenants looking to stay put or seek out cheaper properties to rent."

The slowdown in London and the South East has been attributed to a fall in the number of tenants looking for a home, combined with higher numbers of rentals available.

"Early signs point towards 2017 being a rare year where rents rise faster in the north of the country than in the south," Mr Morris added.

Any fall in rent will likely come as a welcome relief to tenants after years of rises.

Last year, research from the Resolution Foundation found that soaring property prices cut home ownership in England to its lowest level since 1986.

A separate study from housing charity Shelter revealed last year that the so-called Bank of Mum and Dad was helping some 450,000 young adults across the UK to cover the cost of their rent.

Shelter estimated that the money spent by parents amounts to £850m a year on their children's rent and £150m a year on moving costs.