Private sector rents in London increased at eight times the pace of those in the North East over 2013, official figures show.

Every region across Britain saw an annual rise in average rental prices paid by tenants, with London recording the biggest increase over the last 12 months at 1.6 per cent and the North East seeing the smallest at 0.2 per cent, according to the report from the Office for National Statistics (ONS).

Across Britain as a whole, rents rose by one per cent in the year to December – an increase which is half the consumer prices index (CPI) rate of inflation, which fell back to the Bank of England’s target of two per cent in December.

The figures also show that despite London being the region with the strongest annual growth in rental prices, rents have risen at a faster rate in Scotland and Wales than they have in England over the last year.

In the year to December, private rental prices grew by 1.3 per cent in Scotland, 1.2 per cent in Wales and by one per cent in England. If London, with its large volume of rental property, was taken out of the figures, rents would have only increased by 0.7 per cent across England and by 0.8 per cent across Britain over the last year.

The report said that until April last year, the annual pace of rental increases had been higher in England than in Scotland or Wales, but the rate of change has been picking up in Scotland and Wales since late 2012.

Within England, the South East has seen the next strongest growth in rents after London, with a one per cent annual increase, followed by the South West, which saw a 0.9 per cent rise.

The Northern regions saw the slowest growth in rental prices, with a 0.3 per cent annual rise recorded in the North West and a 0.4 per cent increase over the last year in Yorkshire and the Humber.

Fears have grown in recent years that tenants who have been ‘trapped’ in the rental sector because they do not have enough cash put by to make the jump onto the housing ladder have been burdened with strong rental increases amid high demand for rental properties.

But there have been signs of more people finding themselves in a position where they are able to move out of the rental sector, with Government support schemes such as Help to Buy resulting in some strong increases in first-time buyer numbers.

The ONS rental figures were released as the British Bankers’ Association (BBA) reported that the number of mortgage approvals granted to home buyers climbed to a six-year high in December.

The one per cent annual rise in rents recorded across Britain in December marks a slight cooling in rent rises, compared with a 1.1 per cent increase recorded by the ONS in the 12 months to November last year.

The index is part of an ‘experimental’’ series of reports started by the ONS last year to shed more light on how the rental market is evolving across Britain. It takes data from the Scottish and Welsh governments as well as the Valuation Office Agency to regularly measure the change in the price of renting a home from a private landlord. The index is still undergoing evaluation and is likely to be developed further, the ONS said.

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