The cost of privately renting a home has rocketed by the largest proportion since records began to heap more pressure on families unable to get on the housing ladder.
The average UK house price fell by 0.2 per cent in the 12 months to February, slowing from a decrease of 1.3 per cent in the 12 months to January. Across the UK, the average house price was £281,000. Rishi Sunak insisted the official figures showed the 'plan is working' and people will 'start to feel the difference'.
The ONS said the rise in Scotland's annual inflation rate in recent months 'is more reflective of Scotland's average house price falling this time last year, rather than increasing in recent months'. The average private rent in Scotland was £947 in March, up by 10.5 per cent from a year earlier. Scotland's annual inflation rate has been generally slowing since a record-high annual rise of 11.8 per cent in August 2023, the report said.
'On the flip side, private rental inflation continues to reach new highs, adding to the cost-of-living pressures facing households.' Andrew Montlake, managing director of Coreco mortgage brokers, said of the smaller than expected easing in inflation: 'Figures such as these inevitably make the Bank of England jittery and push the chances of a summer rate cut back into the long grass.'
Mark Harris, chief executive of mortgage broker SPF Private Clients, said that until swap rates, which lenders use to price mortgages, are consistently falling, 'lenders are unlikely to reduce mortgage rates further'.