London may be home to the highest rents in the land, with tenants in Kensington and Chelsea paying an average of £3,629 per month, but the latest research from London lettings and estate agent, Benham and Reeves, has revealed that Scotland is actually home to the greatest proportional divide between its most and least expensive rental markets.
Benham and Reeves analysed average monthly rents across each region of Britain, identifying the most and least expensive rental market within each and measuring the difference both in pounds and as a percentage of the lowest monthly rent.
Scotland home to Britain’s biggest rental divide
The research shows that Scotland has the widest proportional rental market divide. The average monthly rent in Lothian currently stands at £1,415, compared to just £554 in Dumfries and Galloway – a difference of £861 per month, with Lothian rents sitting 155.4% higher.
The South West has the second largest proportional divide, with the average rent in Bath and North East Somerset coming in at £1,881 per month.
That’s £1,093 more than the £788 average found in Torridge, meaning rents at the top end of the South West market are 138.7% higher than at the bottom.
London sees largest rental gap in pounds and pence
London ranks third when measuring the rental divide proportionally.
Kensington and Chelsea is not only the capital’s most expensive rental market, but the most expensive location analysed across Britain, with an average monthly rent of £3,629.
In comparison, the average tenant in Bexley pays £1,534 per month. This means Kensington and Chelsea is 136.6% more expensive, although London’s £2,095 monthly difference is by far the largest gap in pounds and pence – equivalent to £25,140 over the course of a year.
Rental divide exceeds 100% across seven regions
The East of England has the fourth largest proportional rental divide, with rents in St Albans (£1,931) coming in 129.9% higher than East Suffolk (£840), a difference of £1,091 per month.
The North West follows, where Trafford rents of £1,367 are 117.7% higher than the £628 average in Burnley.
In the North East, Newcastle upon Tyne is 117.1% more expensive than Hartlepool, while Oxford’s average rent is 106.9% higher than the Isle of Wight, placing the South East seventh.
Elsewhere, the gap between the most and least expensive rental markets stands at 88.5% across Yorkshire and the Humber, 87.9% in Wales and 78.5% across the West Midlands.
The East Midlands is home to the smallest regional rental divide, although rents in West Northamptonshire are still 54.2% higher than in East Lindsey.
Marc von Grundherr, Director of Benham and Reeves, commented:
“London is, of course, in a league of its own when it comes to the actual pounds and pence paid by tenants, and a difference of more than £2,000 per month between the capital’s most and least expensive rental markets demonstrates just how diverse London itself can be.
However, what is particularly interesting is that London doesn’t have the greatest proportional divide. Scotland takes that title, while the South West also ranks ahead of the capital.
It demonstrates why broad regional rental averages only ever tell part of the story. Tenant demand, available rental stock, employment opportunities, transport links, lifestyle and the type and quality of homes available can vary enormously from one location to the next, and rental values vary accordingly.
We see exactly the same dynamic within London. A tenant looking for a home in Kensington and Chelsea is operating within a very different market to someone searching in Bexley, despite both technically renting within the same region.
For landlords, understanding these local market dynamics is fundamental. The highest headline rent doesn’t necessarily equate to the strongest investment opportunity and what really matters is the relationship between the price paid for a property, the rent it can command and, most importantly, the depth and consistency of tenant demand.
This is why successful landlords tend to take a far more granular view of the market, focusing on the fundamentals of an individual area rather than being distracted by broad regional averages.”
Data tables and sources
Source: ONS – Private rent and house prices, UK
Analysis: Benham and Reeves analysed the latest ONS private rental data, identifying the location with the highest and lowest average monthly rent within each region of Britain. The difference between the two was then calculated in pounds per month and as a percentage of the lowest rental value.
