The cost of renting in Britain reaches record highs – but things might improve for tenants soon

Independent

a day ago

Asking rents across Britain have reached new record highs, according to an index.
The average rent being asked across Britain, excluding London, has reached a record £1,365 per month, according to figures from Rightmove covering the second quarter of this year.
Despite reaching a new record, the average asking rent for a home outside of London is now 3.9 per cent higher than this time last year, the lowest this annual growth figure has been since 2020.
In London, the average advertised rent has also reached a new high, at £2,712 per month.
Average advertised rents for new properties in London rose by 1.9 per cent annually.
Rightmove, which used data from its website, said that it is taking an average of 25 days for a rental home to be marked 'let agreed', up from 21 days last year and 18 days in 2022.
Nearly a quarter (24 per cent) of rental homes are having price reductions while they are advertised, marking the highest proportion recorded by Rightmove since 2017.
It said that the slowing in the pace of rental price growth has been partly because of the balance between supply and demand improving.
It is seeing the best balance between supply and demand in the rental market since 2020.
The number of properties for tenants to choose from is 15 per cent higher than a year earlier, but remains 29 per cent below the level seen in 2019, just before the coronavirus pandemic lockdowns in the UK.
Tenant demand has also fallen by 10 per cent compared with a year earlier.
The average number of inquiries a typical rental property receives is now 11 – down from 16 last year, but up from seven in 2019 – the report said.
Five years on from when the pandemic began, the average monthly rent that a new tenant faces paying is more than £400 (£417) more than in 2020, Rightmove said.
Colleen Babcock, a property expert at Rightmove, said: 'Despite another new record in average asking rents for tenants, the big picture is that yearly rent increases continue to slow, which is good news for tenants.
'Supply and demand is slowly rebalancing towards more normal levels, though we still have a way to go before we reach pre-2020 levels of available homes for tenants.'
Alex Caddy, manager at Clarkes Estate and Letting Agency, said: 'The rental market has undergone a marked shift in 2025.
'After several years of sharp rent inflation post-pandemic, tenants hit a ceiling by late 2024, leading to widespread price slowdowns.
'Competitively priced, well-presented properties continue to attract strong interest, echoing trends seen in the sales market. However, the market is now dealing with a much higher supply of rental homes, a complex reversal of previous trends.
'Some landlords have exited the sector over the past two years due to rising regulatory and financial pressures, but with the sales market slowing in some areas, a growing number of those properties have re-entered the rental market.
'Demand remains robust, particularly for quality one and two bedroom homes. Larger properties are moving more slowly, with some seeing longer void periods as tenants benefit from increased choice.'
Andrew Ralph, managing director, lettings at LRG (Leaders Romans Group) said: 'We're seeing a shift in the rental market this quarter. Stock levels are up, and demand remains strong but more measured, bringing us closer to a sustainable balance.
'Average rents are still rising year-on-year, but at a slower pace. Pricing correctly from the outset is key, and being quick to adjust price in line with market response helps avoid unnecessary void periods.'
Megan Eighteen, president of property professionals' body Arla Propertymark, said: 'Many landlords within the private rental market are grappling with substantial hikes in their overall costs, including increased taxes, unfavourable mortgage rates, and ongoing regulatory challenges.
'These factors are making property investment less appealing and potentially riskier.'
Richard Lane, chief client officer at StepChange Debt Charity, said: 'The last five years have hit household finances hard, but few have felt it more sharply than those in the private rented sector.
'The majority of our clients struggling with debt are renters, with a third in the PRS (private rented sector). Our data shows that among StepChange clients, housing costs take up 37 per cent of private renters' incomes on average – compared to 29 per cent among social renters and 27 per cent among mortgage holders.
'When so much of your income goes on rent, it's no wonder private renters are more exposed to debt and financial hardship.'
Ben Twomey, chief executive of Generation Rent, said: 'When so much of our income is swallowed up by landlords, it can mean that we can't afford to heat our homes for the winter or feed ourselves properly. Some renters are staring down the barrel of debt and homelessness.'