The Data Observatory

The NRLA Data Observatory is a collection of official and other well-established data sources which when combined, provide a narrative of the Private Rented Sector (PRS). The NRLA tracks approximately 45 key data sets which are updated monthly, quarterly and annually. A selection of these data sets appear in these pages.

Our Deep Insight blog provides a regular extension of the analysis which appears here, as well as those datasets which are not published in the Data Observatory section of this website.

The blog pages also features blog posts from other organisations and academics to provide insight on the PRS. Here you can also find more in-depth summaries of our regular reports and surveys.

Growth & the PRS

GDP

Chart 1: Change in GDP-measured quarterly

Real GDP, UK economy (CVM First Estimate)

Although revised data may revise this analysis over the course of the next few weeks, the UK economy moved into recession with Quarter 4 (-0.3% growth compared to the previous quarter) following Quarter 3 (-0.1%) with negative growth. The previous quarter also recorded zero (0.0%) growth, emphasising the difficulties the economy is having at present.

Over the year as a whole, real GDP fell by 0.2%, the first time negative annual growth across four quarters had been recorded since 2021 Quarter1 when the economy was affected by Covid. However the ONS report the economy is 0.1% larger at the end of 2023 than it was at the beginning.

Note that the graph shows first estimate data which will differ as the ONS revise their own figures. 

Construction output has been particularly badly affected over the last quarter with a 1.3% reduction in Output over the quarter.

Note that GDP is always subject to some revision. This is especially true post-Covid. The NRLA track the "first estimate" series. Resources mean revisions cannot always be inserted into these pages, except when new quarterly data is announced. Researchers are advised to check the relevant ONS data for the most recent figures.

 

(Note that GDP is always subject to some revision. This is especially true post-Covid. The NRLA track the "first estimate" series. Resources mean revisions cannot always be inserted into these pages, except when new quarterly data is announced. Researchers are advised to check the relevant ONS data for the most recent figures.) 

 

Changes in price indices

Chart 2: Private rental price changes compared to other price indices

The new PIPR Index

This month the Index of Private Housing Rental Prices (IPHRP) has been replaced by the ONS as the measure of rental price inflation.

Its replacement, the Price Index of Private Rents (PIPR), has a completely different methodology. It is also possible now to monitor changes in rental values in a specific local authority area. The ONS has also enhanced its house price index data and publishes analysis of both datasets alongside each other.

The IPHRP is no longer calculated. The PIPR at present shows rental price growth to be higher than the previous measure.

The chart above focuses on price changes in the economy since 2019. It shows different measures of price change: The PIPR index – described by the ONS as “official statistics in development…subject to revisions if improvements in the methodology are identified”.

This measure of rental price inflation is compared in this chart to two price indices (the CPI and CPI-H). Each of these collects price data from across the wider economy, the latter placing a greater weight on housing costs [for reference the old IPHRP has been left on the chart, although there is no data for February].

The above chart tracks price movement on a month-by-month basis using index numbers. This shows how prices have moved each month using data from the ONS. The more widely reported annual indices provide a snapshot of the latest available price information, compared to those collected twelve months ago.

The rental prices index (PIPR)moved ahead of the CPIH in February, the first time this has happened since March 2021. Rental prices are still behind the CPI on a month-by-month basis.

On an annual basis the PIPR stands at 9.0%pa. PIPR has been reverse calculated back to 2015 (so annual growth data begins in 2016), and this is the highest 12-month growth period in this time. The previous highest was recorded in January 2024 (8.5%pa). For comparison the CPI is at 3.4%pa and CPIH is 3.8%pa.

The largest downward contributions to the monthly change in both CPIH and CPI annual rates came from food, and restaurants and cafes. The largest upward contributions came from housing and household services, and motor fuels.

Note that these wider indices have also been updated to take account of PIPR. The ONS has also improved the data on second hand cars.

For more detail on UK-inflation see this report by the ONS. 

The Price Index of Private Rents (PIPR) measures private rent inflation based on data from over 500,000 rent prices across the UK. The PIPR is based on achieved rents for both new and existing tenancies.

More information on PIPR and the methodology can be found in this December 2023 article.

The CPI is a measure of consumer price inflation. It is the preferred measure for inflation targeting and uprating state pensions and benefits. CPI is also the international standard for comparing inflation rates between countries.

The CPIH meanwhile gives added weight to the housing costs associated with owning, maintaining, and living in one's own home. CPIH also includes Council Tax. The ONS describe the CPI(H) as “the most comprehensive measure of inflation.”

Wages & the PRS

Chart 3: A comparison between wages & rental prices

Real wages and rental prices

Chart 3 shows wage growth continuing to stay flat once inflation is taken into account.

Year-on-year real wages (Average Weekly Earnings) have grown. When compared to the same month in 2023, real wages in January 2024 grew by 1.3% - however in the January 2023 annual real wage growth fell by 2.5%. This pattern is how two things can be right at the same time:

  1. Real wages are growing year-on-year and have done so since June 2023.
  2. When looking at the growth in wages (weekly earnings) indexed, the trend line is flat – in fact since June 2023 the measure used here, which is seasonally adjusted, has fallen by more than 2%.

In January 2024 average real average weekly earnings (in 2015 prices) were £512pw. In January 2020 (pre Covid-19) average real weekly earnings were £500pw.

More information on wages in Great Britain can be found in this ONS analysis.