• Average North East rents rose from an average of £554 in December 2015 to £591 in December – an increase of 5.9%
2016 was not a great year for making predictions – but an investigation into the accuracy of some of the forecasts made by property experts this time last year proves that many were pretty much on the money.
Analysis of property market predictions made by North East sales and lettings firm KIS shows that estate agents Knight Frank correctly prophesised UK annual rent growth of 2.3%, with competitors Belvoir and Savills, and the Royal Institute of Chartered Surveyors not far behind.
Major estate agency Hampton’s and highly-respected property commentator Henry Pryor, who predicted rises of 5.5% and 6% respectively, turned out to be furthest away from the final figure.
Data from the Office of National Statistics suggests rents across the UK rose by 2.3% in 2016, with figures from insurer Homelet suggesting a slightly higher rise of 3.1%
KIS’ own analysis of 20 North East areas – compiled as part of its monthly Housing Now report – indicates that rents in the region rose from an average of £554 in December 2015 to £591 last month, a rise of 5.9%.
The following predictions for how much UK rents would grow in 2016 were made this time last year
• Knight Frank – 2.3%
• Belvoir - 3%
• Savills – 3%
• Royal Institute of Chartered Surveyors – 3%
• Countrywide – 3.5%
• JLL – 4.5%
• Price Waterhouse Coopers – 5%
• Hamptons -5.5%
• Property Commentator Henry Pryor (interviewed by Zoopla) – 6%
Ajay Jagota, managing director of KIS Group and founder of deposit-free renting solution DLighted responded to the figures:
He said: “If we’ve learned one lesson from 2016 it’s that predicting anything is asking for trouble, but if these figures are anything to go by property experts are doing a much better job of foreseeing the future than professional pollsters do at election time.
“The average rent rise prediction in the forecasts we’ve revisited was 3.9%, and although we’re the first to admit that that figure isn’t exactly scientific, it does appear that industry consensus at the start of the year was pretty close to the 3.1% Homelet recorded at the end.
“A big thing to take away from these figures too is that although rents are rising, they aren’t rising as quickly as even some of the experts think. As things are, the market is giving a good deal to both tenants and investors and policy makers should be cautious about pursuing any measures which could jeopardise that”.
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