£3,250 £4,358 +5.4%
MARKET OVERVIEW
STABILISING CONDITIONS
After several years of strong rental growth, rates on new market lets are easing, helping to ease the pressure on rental affordability too. As ever Q3 is the busiest time of year for rentals, though overall market conditions are becoming more balanced.
MORE MODEST LEVELS OF GROWTH
After years of high rental growth, more modest levels are now emerging. Across the UK, annual rental growth stands at 0.4%, compared to 5.2% a year earlier¹. However, the slowdown is more pronounced in some regions. Annual rental growth in London has eased to -0.9%. In the prime market however, the average rent is £4,358, up 5.4% year-on-year. Affordability remains a critical factor, and where particularly overstretched, is expected to constrain further rental growth. Renters are able to make regular choices on how to limit the affordability impact. Rental affordability is now at 29.3% of gross earnings, down from 30.1% in September 2024². Looking forward, rental growth is forecast to return to more typical levels, averaging 3.2% annually to 2029³.
TYPICAL SUMMER SURGE IN DEMAND
Summer is typically one of the busiest times in the rental market. During this season, many rental homes change hands as graduates begin new jobs, students move to university, and others relocate to live with friends. With the peak rental season in full swing, demand remains high, and properties are letting quickly. In June, the average void period fell to 20 days for the first time in four months4 . However, looking beyond seasonal trends, RICS data indicates more normalised supply and demand levels than seen in recent years, particularly an easing on the demand side. Despite this, supply pressures remain, with 38% of agents reporting fewer available properties compared to three months ago5
¹ HomeLet, ² ONS Affordability Tracker, based on PriceHubble data, ³ Consensus Forecast across agents as at July 2025, 4 Goodlord, 5PriceHubble, poll of subscribers, June 2025
£1,820
£2,305 +6.5%
£23
£1,600
£1,942 +1.7%
£17
£1,600
£1,901 +7.4%
£18
£2,140
£2,876 -2.4%
£24
£2,600
£3,490 +4.9%
£24
£1,390
£1,802 +9.5%
£18
£1,500
£1,809 +6.5%
£17
£1,500
£1,791 +1.7%
£15
£4,260
£5,980 +3.7%
£51
£2,200
£2,761 +6 7%
£22
£1,337 £3,250 £4,358
£1,381 £3,250 £4,184 £1,287 £3,200 £4,556
Source: Dataloft Rental Market Analytics by PriceHubble