Average monthly private rents in the UK increased by 8.1% year-on-year in February, reaching £1,326, according to figures from the Office for National Statistics (ONS). This marks a slight slowdown compared to the 8.7% growth recorded in January.
Wales experienced the steepest rise, with rental prices climbing by 8.5%, bringing the average rent to £785 per month. England followed closely with an 8.3% increase, resulting in an average rent of £1,381, slightly below the 8.8% growth observed the previous month.
In Scotland, rental prices rose by 5.8% compared to the same period last year, with tenants now paying an average of £998 monthly. Meanwhile, the ONS reported that in Northern Ireland, where the latest data reflects December figures, rents were up 8.1% annually, averaging £832 per month.
London saw the highest rental inflation within England, with rents rising by 9.9% to an average of £2,235. While this represents a significant increase, it is slightly lower than the 11% rise recorded in the year leading up to January 2025. The capital also continues to have the highest average private rental prices in the country.
In the 12 months leading to February 2025, Yorkshire and the Humber recorded the slowest annual rental growth among UK regions, with an increase of 4.8%. This modest rise brought the average monthly rent in the region to £813. Compared to the national average, rental inflation in Yorkshire and the Humber has remained relatively subdued, reflecting slower market changes.
Meanwhile, the North East held the distinction of having the lowest average private rent across the UK. Despite rising housing costs nationwide, renters in this region paid an average of £715 per month, significantly below the national average. This highlights regional disparities in rental affordability, with areas like the North East continuing to offer more budget-friendly options for tenants.
Renters’ Rights Bill could inflate rental prices
Concerns have been raised about the potential impact of the Renters’ Rights Bill on the rental market, particularly with fears that the legislation could prompt landlords to exit the sector. This reduction in supply may drive rents upward, despite recent signs of a slowing growth rate in average rental prices.
Alex Upton, managing director for specialist mortgages and bridging at Hampshire Trust Bank (HTB), noted that rising rents remain an issue due to the fundamental shortage of rental homes. However, she highlighted a shift in the market, referencing Zoopla’s latest rental market report, which shows a decline in the number of renters competing for each property. While still high at 12 renters per listing, this figure marks an improvement compared to previous years. Upton suggested that this easing demand may be contributing to the observed slowdown in rental growth, with Zoopla reporting the lowest rent increases in over three years.
Upton also addressed the potential impact of the Renters’ Rights Bill, describing it as “the elephant in the room.” While she acknowledged the bill’s intention to improve rental standards – an aim HTB supports – she expressed concerns about the potential for reduced rental stock in the short term, which could, paradoxically, drive rents higher. Despite this, she noted that “change also brings opportunity,” particularly for professional landlords who are adjusting their strategies to maximise rental yields. Upton encouraged brokers and lenders to adapt accordingly, suggesting that a broader selection of high-quality rental properties could eventually benefit tenants.
Nathan Emerson, CEO of Propertymark, echoed similar concerns. He pointed out that the Renters’ Rights Bill places limited emphasis on encouraging the supply of new rental properties, which may be contributing to ongoing rent increases. However, Emerson acknowledged that recent figures show annual rent inflation for new lets at its lowest level in 3.5 years, offering some hope for tenants.
Despite this modest slowdown, Emerson cautioned that continued legislation aimed at safeguarding renters could have unintended consequences. He warned that overly strict regulations might deter landlords, leading to a reduced supply of rental homes, further rent hikes, and greater difficulty for people seeking affordable housing. This, he argued, underscores the need for balanced policymaking that addresses both tenant protections and the sustainability of the rental market.
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