Rents across the UK have fallen slightly for the first time in more than five years—although tenants in London are still seeing new highs, according to fresh data from Rightmove.
Outside the capital, advertised rental prices dipped by 0.2% to an average of £1,341 per month, the first such decline since late 2019.
Although the monthly difference equates to just £3, Rightmove describes it as a “key milestone,” reflecting a slowly improving balance between supply and demand in the rental market. Rents are still 4.7% higher than a year ago, but that is well below the inflation peak of 12% in 2022.
Colleen Babcock, Rightmove’s head of trade marketing, attributes the easing to more rental properties entering the market—up 13% on last year—while the number of prospective tenants has fallen by 16%. The northeast of England has led the way in supply growth. Babcock believes some former renters have transitioned into home ownership, thanks to stabilising mortgage rates and slower house price growth.
Still, demand for rental homes remains at double the pre-pandemic norm, with each property attracting around ten applicants on average. This persistent imbalance has pushed rents 64% higher outside London since the first lockdown in March 2020. During the same period, London rents have risen by 28%.
In contrast to the modest decline elsewhere, average rents in the capital have climbed to a record £2,695 per month, marking new highs in every quarter since late 2021. That said, London’s annual increase of 2.4% is the lowest in almost four years.
“We’re seeing a cooling of what has been a ferociously hot rental market,” said Alex Bloxham, head of residential lettings at Bidwells, who notes that any continued improvement in supply should put downward pressure on rents.
Meanwhile, Labour’s proposed Renters’ Rights Bill, which aims to enhance tenant security and rights, could be introduced later this year. Some landlords have voiced concerns about these reforms, but Rightmove says it has not observed any immediate impact on current market conditions.
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UK rents slip for the first time since 2019, but London remains at record highs