For the first time since before the COVID-19 pandemic, the average private rents in Great Britain have fallen. The typical advertised rent outside London decreased in the final quarter of 2024 to £1,341 per month. This marks a significant shift in the rental market, which has not seen a decline in rents since 2019. Contributing to this change is the increased number of available homes for rent, which rose by 13% compared to the same period last year. Additionally, the number of prospective tenants contacting letting agents about moving has decreased by 16%.
Despite this overall decline, London remains an exception. Average rents in the capital continued their upward trajectory, reaching a record high of £2,695 per month. Over recent years, rental prices have surged largely due to the pandemic and its aftermath, which triggered many individuals to relocate for work or lifestyle changes. The rental market has been described as "ferociously hot" during this period.
Outside London, while the average rent is now £1,341 per month, it still represents a 4.7% increase compared to the previous year. The broader market dynamics have been influenced by several factors including a gradual improvement in the supply of properties, which has helped cool down the market. Notably, one in four homes for sale in London were previously available for rent, compared to one in five in 2023. Similarly, 15% of homes listed for sale on Rightmove had been rentals in 2024, up from 13% the previous year.
“We’ve seen a levelling-off in demand from tenants due to many factors, including the end of the post-pandemic surge for new rental requirements, and some demand heading to the sales market.” – John Baybut, managing director at Berkeley Shaw Real Estate in Liverpool.
The easing of demand is reflected in the cooling rental market across Great Britain. This shift has provided some relief from the intense competition and consistent rental inflation that tenants have faced.
“We’re seeing a cooling of what has been a ferociously hot rental market over the last year, where tenants have endured intense competition and consistent rental inflation.” – Alex Bloxham, partner and head of residential lettings at Bidwells.