- Tenants are paying over £400 extra per 30 days than they had been 5 years in the past, on common
- Nonetheless, regardless of the report excessive, the yearly tempo of progress continues to decelerate – that is excellent news for tenants because the market rebalances
- The present market has the greatest steadiness between provide and demand in 5 years, with extra properties accessible and fewer individuals competing for them
Rents have climbed to one more report excessive this quarter. Outdoors of London, common asking rents have reached £1,365 per 30 days — up 1.2% on the primary three months of the yr. Whereas that’s one other new peak, the yearly progress charge has truly slowed to three.9% – the bottom it’s been since 2020.
London rents have additionally ticked up by 0.5% to £2,712 per 30 days, marking a fifteenth consecutive report. However once more, the tempo of will increase is far gentler than the steep climbs we noticed through the pandemic years.
5 years on from when Covid first hit, the numbers paint a stark image of how rather more costly renting has turn out to be. New tenants at the moment are paying over £400 extra per 30 days than they had been in 2020 – that’s a 44% leap in rents in comparison with a 36% improve in common wages.
Most of this eye-watering progress occurred through the frenetic pandemic years of 2021 and 2022, when the rental market went into overdrive. The excellent news is that since late 2023, the market has began to rebalance and discover its ft once more.
Our property professional Colleen Babcock says: “Regardless of one other new report in common asking rents for tenants, the massive image is that yearly hire will increase proceed to sluggish, which is nice information for tenants. Provide and demand is slowly rebalancing in the direction of extra regular ranges, although we nonetheless have a technique to go earlier than we attain pre-2020 ranges of obtainable properties for tenants.”
Check out all of the insights in our newest Rental Worth Tracker.
What does this imply for tenants?
There at the moment are 15% extra rental properties accessible in comparison with this time final yr, with the North East main the cost with a 33% improve in accessible properties. On the similar time, tenant demand has dropped by 10% in comparison with final yr.
This improved steadiness means the common rental property now will get 11 enquiries, down from 16 final yr. Whereas that’s nonetheless greater than the 7 enquiries we noticed again in 2019, it exhibits the rental market has cooled from its pandemic peak.
With extra selection and fewer competitors, tenants may discover there’s house to be extra picky, in addition to having a bit extra negotiating energy. As Alex Caddy from Clarkes Property and Letting Company places it: “The rental market has undergone a marked shift in 2025. After a number of years of sharp hire inflation post-pandemic, tenants hit a ceiling by late 2024, resulting in widespread value slowdowns.”
There’s extra excellent news relating to the selection of properties accessible for renters. Knowledge from UK Finance exhibits buy-to-let lending is choosing up, with a 17% improve within the whole variety of loans to property buyers this yr. Even higher for tenants, new rental residence purchases are up by 28%.
This renewed funding from landlords ought to assist convey extra rental properties to the market, which retains hire progress in examine and offers tenants extra choices.
Properties are taking longer to let
The cooling market is having some attention-grabbing knock-on results. Rental properties at the moment are taking a mean of 25 days to discover a tenant, up from 21 days final yr and properly above the 18 days we noticed through the 2022 rental frenzy. Almost 1 / 4 (24%) of rental properties are additionally seeing value reductions throughout their advertising – the very best charge since 2017.
This exhibits that getting the value proper from the beginning is changing into essential, and landlords who’re fast to regulate their expectations consistent with market response can keep away from prolonged void durations. With tenants having extra selection, landlords are having to be extra sensible about pricing.
Rental market developments differ by location
The rental market isn’t uniform throughout the nation. Some areas are nonetheless seeing vital hire will increase, whereas others are extra balanced.
Ascot in Berkshire tops the hire progress charts with a +21% annual improve, pushing common rents to £2,259 per 30 days. Farnham in Surrey isn’t far behind with a +19% rise to £1,870.
Within the North West, Rochdale has seen rents leap +17% to £959, whereas Stockport is up +15% to £1,206. Glasgow has additionally skilled a marked improve (+12%), bringing rents to £1,219.
However it’s price noting that these will increase, whereas nonetheless vital, are typically decrease than what we had been seeing through the pandemic.
What may occur within the rental market subsequent?
The rental market appears to be transferring in the direction of a extra sustainable steadiness, although there are nonetheless some challenges. Pupil lodging is dealing with specific pressures – a lowered college consumption for 2025 is leaving many homes of a number of occupation unlet for September.
Consequently, some scholar landlords are including their properties to an already well-supplied market. Whereas demand stays sturdy for high quality one- and two-bedroom properties, bigger properties are transferring extra slowly. Some are experiencing longer void durations as tenants profit from elevated selection.
On the similar time, the upcoming Renters’ Rights Invoice modifications are prompting some landlords to evaluate their method. There’s additionally elevated deal with guaranteeing tenancy lengths align with each landlords’ plans and tenants’ expectations.
Regardless of these modifications, the general variety of landlords leaving the market stays consistent with current years.
Ideas for renters within the present market
Whereas the rental market is rather more settled than lately, competitors between tenants continues to be sturdy.
- Be ready however not panicked: Arrange property alerts to remain knowledgeable, however keep in mind you now have a bit extra time to make choices than through the pandemic rush.
- Analysis completely: With extra properties accessible, take time to match choices. You can begin your seek for a rental residence right here, in addition to drawing a search space if you understand they location you’d prefer to dwell in.
- Have your paperwork prepared: References, proof of earnings and ID ought to all be simply accessible.
- Take into account timing: With properties taking longer to let and extra value reductions occurring, there may be alternatives if you happen to’re versatile about move-in dates.
- Take into account broadening your search space: With 15% extra properties accessible, take into account widening your search space – you may discover your finances goes additional in areas you hadn’t beforehand thought-about.
Check out our suggestions for reinforcing your possibilities of getting a viewing
Header picture supplied courtesy of Reside Bathtub Restricted, Bathtub
