London rental prices have continued to rise, reaching an all-time high of £2,712 per month. This marks the 15th consecutive quarter that rents in the capital have increased. Across the rest of the UK, the average monthly rent now sits at £1,365.
According to data from property website Rightmove, tenants are now paying £417 more per month compared to figures seen in 2020. This represents a 44% rise in rent, significantly outpacing the 36% increase in average wages during the same period.
Colleen Babcock, a property expert at Rightmove, pointed out that while rents are still rising, the pace of these increases has begun to slow, which may come as welcome news to tenants. She also noted signs that the market may be beginning to stabilise.
Babcock explained that the balance between supply and demand in the rental sector is gradually returning to more typical levels. However, she acknowledged there’s still a considerable gap to close before reaching the availability seen before 2020.
Encouragingly, there are signs that more landlords are returning to the market, with a rise in buy-to-let mortgage applications compared to last year. This could lead to more homes becoming available to rent, which may help ease pressure on tenants.
Increases in rental prices have been most notable in commuter towns and traditionally lower-cost areas in the North. Ascot in Berkshire saw the steepest annual rent rise, jumping by 21% to £2,259 a month. Farnham in Surrey followed closely with a 19% increase, driven by demand from those seeking luxury within reach of the capital.
Northern towns are also seeing strong growth. In Greater Manchester, rents in Rochdale rose by 17% and Stockport by 15%. These areas are becoming more attractive, especially to remote workers seeking better value for money outside of the South East.
Glasgow also experienced a notable jump, with rents climbing 12% year-on-year to £1,219 per month. This shows how even Scotland’s largest city is being affected by the broader rental trend across the UK.
Towns in the North West such as Birkenhead and Prenton on the Wirral recorded rent rises of around 11%. This shows how increasing demand and limited supply are pushing up rents beyond the usual hotspots like London and Manchester.
Other areas including Watford, Andover, and Kidderminster have also seen double-digit rental increases. The common thread in all these towns is rising tenant interest and not enough available properties to meet demand.
Rightmove’s figures show that average asking rents for new listings in London rose by 0.5% in the most recent quarter, reaching £2,712 per month. This continues the trend of record-breaking rents in the capital.
There has, however, been a slight improvement in supply. The number of rental properties available across the UK is up by 15% compared to last year, with the North East seeing the most notable increase of 33%.
Despite these gains, the supply of homes is still 29% below levels seen before the pandemic. Meanwhile, demand from tenants has dipped by 10% year-on-year, leading to fewer enquiries per property.
The average rental listing now receives around 11 enquiries, a decrease from 16 last year, though still above pre-COVID levels when the average was 7. As the market cools slightly, letting times are increasing.
It now takes an average of 25 days for a property to be marked as “let agreed”, up from 21 days last year and 18 days at the peak of pandemic-driven demand in 2022. Nearly one in four rental homes have had to lower their asking price during the marketing period, the highest rate seen since 2017.
Alex Caddy, a manager at Clarkes Estate and Letting Agency, said that the rental market began to shift in 2025. After years of steep rent hikes, tenants have reached their limit, slowing the pace of increases. Still, well-maintained and well-priced properties are continuing to perform well, while others are sitting empty.
Caddy added that the student housing sector is facing its own challenges. A reduction in university admissions for 2025 has resulted in many HMOs (houses in multiple occupation) remaining vacant for the upcoming academic term.
Andrew Ralph, managing director of lettings at Leaders Romans Group, said this quarter reflects a more balanced rental landscape. While stock has increased, demand remains steady. He emphasised the importance of pricing rentals accurately and adjusting quickly to changing market conditions to avoid long vacancy periods.
Ralph also pointed out that matching the right tenants with the right homes is more critical than ever. As some landlords exit the market due to financial or regulatory challenges, new, tech-savvy investors are stepping in, helping to maintain property availability.
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