Zoopla says rents are rising at the fastest rate for 13 years - but what does the official data say?
Property website Zoopla announced on Tuesday (16 November) that rent prices are rising at the fastest pace for 13 years.
Private sector rents in the UK grew by 4.6% in the year to September, and by 6% if London is excluded, it said in its Rental Market Report.
The story has been widely reported, including by BBC News and the Guardian.
But can the figures be trusted, and do they tell the whole story?
How does Zoopla calculate its figures?
Zoopla’s report says it has analysed “tens of thousands” of data points to arrive at its conclusions.
The primary data used is new properties listed on its advertising platform – although the report does not explicitly mention this.
The Office for National Statistics (ONS) also publishes data on rental prices, however.
Its figures are based on analysis of almost half a million properties, and are based on all private rental properties – including contracts being renewed by landlords – rather than just newly advertised ones.
The ONS says this gives a “more stable” picture than just looking at new lets, with the latter subject to “more volatility between each month”.
What do the official figures say?
The latest ONS figures, which cover the same time period as Zoopla’s report, reveal much smaller growth.
In the year to September 2021, rents across the UK rose by 1.3%. That was far from a record high – annual growth in the year to September 2020 was in fact higher, at 1.5%.
Excluding London, annual growth was 2.1% – far lower than Zoopla’s figure of 6%.
Sources used by the ONS are the Valuation Office Agency, and Scottish, Welsh and Northern Ireland governments. The data is still in its ‘experimental’ stage, meaning the methods are being carefully tested and refined before being designated as ‘national statistics’.
Coverage of Zoopla’s figures by other publications has largely failed to clarify that it concerns only new rents.
Where are rents rising the most?
According to the ONS data, the UK regions that saw the strongest increase in rental prices in the year to September were the South West and the East Midlands, at 2.7%.
This excludes Northern Ireland, which had a rate of increase of 4.3%. Its price data however has been copied forward every month since July, as new data is not available until December.
London was the only area to see a decline, at -0.3%.
Across England as a whole, prices rose by 1.3%, by 1.2% across Wales, and by 1.6% in Scotland.
What do the experts say?
Dr Anthony Masters, Royal Statistical Society (RSS) statistical ambassador, said: “The Zoopla rental price measure is for new lets. Newly-let properties can tend to show higher rental price growth than existing lets.
“Since the ONS experimental index tracks both new and existing lets, annual change is less volatile.
“The ONS index also uses rents at date of collection, whilst Zoopla gathers its data at the time of advertisement.”
Zoopla was contacted by NationalWorld but did not respond.
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