Rents across the UK have reached another record high, according to new data released by Rightmove. The average listed rent for properties outside of London now stands at £1,349 per month.
In the capital, the trend is much the same. London has seen rents climb to yet another record, now averaging £2,698 per month — the fourteenth consecutive rise recorded by the property portal.
Despite these high figures, the rental market appears to be easing slightly in terms of pace. Rightmove noted that this is the smallest rise typically seen at this point in the year since 2020, suggesting some cooling in the market’s momentum.
Interestingly, more landlords are being forced to adjust expectations. Around 25% of rental listings are now seeing a reduction in their advertised price — the highest proportion recorded for this time of year since 2018.
In terms of quarterly growth, the figures show a modest increase. Rents for new properties listed outside of London rose by 0.6% in the first quarter of the year. Meanwhile, the capital experienced an even more subdued rise, with just a 0.1% increase in the same period.
More homes coming up for rent
The recent slowdown in rent increases across the UK appears to be linked to a greater supply of rental properties becoming available.
According to Rightmove, the number of new rental listings in March was 11% higher than the same period last year. In addition, the total number of available rental homes is now 18% up compared to 2023, offering tenants more choice in the market.
Colleen Babcock, a property expert at Rightmove, commented that the shift in supply and demand is a positive sign for renters. With more homes to choose from, landlords are beginning to adjust their pricing strategies.
“This broader availability is beginning to ease the pressure on rents,” she explained. “We’re seeing slower increases in rental prices and more landlords opting to lower their asking price.”
This trend may also reflect the financial strain tenants are currently facing. For many, rent increases have outpaced salary growth over the past few years.
Since 2020, average earnings have risen by 31%, while rents have jumped by around 40% during the same period. This mismatch is likely prompting some landlords and letting agents to cut prices in order to attract suitable tenants.
As affordability becomes a growing concern, the rental market could continue to stabilise, particularly if the number of available homes keeps rising in the months ahead.
During the first quarter of this year, there was a 7% increase in the number of sales agreed on properties typically bought by first-time buyers, compared to the same period in 2023.
This uptick is partly due to buyers hurrying to complete transactions before the rise in stamp duty in England on 1 April. Slightly better mortgage rates than last year have also encouraged more people to consider buying instead of renting.
As a result, demand from prospective tenants has declined slightly. Rightmove reports a 7% drop in tenant enquiries in March compared with the same month last year.
Between January and March, each rental property received an average of 12 enquiries — a noticeable drop from the 16 enquiries seen during the same period in 2023.
However, rental demand still varies across different regions. For instance, a typical rental property in London currently attracts around eight enquiries, while in the North West that figure stands at 18, highlighting a continued imbalance depending on location.
Where are rents rising most?
Although rental growth has slowed down, landlords still appear keen to invest in buy-to-let properties.
Recent figures from UK Finance reveal a significant surge in the number of buy-to-let mortgages taken out during the last quarter of 2024.
According to the data, 52,648 new buy-to-let mortgage deals were completed between October and December 2024, with a total value of £9.6 billion.
This figure includes both new property purchases and remortgages, marking a notable 39.2% rise compared to the same period in 2023.
When looking specifically at buy-to-let mortgages used for purchasing property, the growth becomes even more striking.
During the final quarter of 2024, there was a 46.4% year-on-year increase in the number of buy-to-let loans used to buy properties.
In addition to the rise in mortgage volume, the overall value of these loans also saw a sharp increase.
UK Finance reported that the total amount borrowed through buy-to-let purchase mortgages climbed by 47.2% compared to the previous year.
This data suggests that despite changing market conditions, investor interest in the private rental sector remains strong.
Many landlords may be taking advantage of easing mortgage rates or anticipating future growth in rental demand.
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