Inflation outstripped rental progress up to now 9 months, Hamptons evaluation exhibits.
In August 2025, newly agreed rents throughout Nice Britain fell by 0.4% year-on-year, a determine equal to £6 per thirty days.
Regardless of the latest slowdown, rents have risen quicker than inflation – as measured by the Client Worth Index (CPI) over each 5 and 10 years – up 31.0% vs 24.9% CPI over 5 years, and 41.0% vs 33.7% CPI over 10.
Aneisha Beveridge, head of analysis at Hamptons, mentioned: “For a lot of the final 5 years, quickly rising rents have been a key contributor to the UK’s excessive inflation story. However after a number of years of speedy rental progress, the tide is lastly turning.
“For the ninth month in a row, rents have risen extra slowly than inflation—providing tenants a uncommon second of economic respite. Whereas the month-to-month financial savings could appear modest, they mark a major shift within the rental market’s position in driving inflation.
“Over the long term, rents have constantly outpaced inflation, which implies tenants at present are paying greater than they’d have if rents had merely tracked CPI. For essentially the most half, this has mirrored the rising value pressures dealing with landlords. However this latest slowdown suggests the market is recalibrating. With affordability stretched and demand softening, landlords are having to regulate to draw tenants.”
In August, the variety of unlet properties available on the market was 8% increased than the identical time final yr, whereas tenant demand softened barely, with 4% fewer renters starting their search.
Nathan Emerson, CEO of Propertymark, mentioned: “A cooling in rental costs isn’t essentially as detrimental for landlords, provided that mortgage merchandise have improved, offering these with buy-to-let tracker mortgages an easing in monetary stress, which may mitigate the impression or scale back lease rises.
“The stabilisation of rental ranges will equally be welcomed by many tenants who’ve been struggling towards the rise in inflation over the previous few years, which exceeded what folks have been traditionally used to. Not solely have the will increase in the price of residing pushed lease costs up, however they’ve additionally, partly, been attributable to an imbalance of provide and demand.”
