The rental market in the UK is changing. As of April 2025, the average rent for new rental homes is £1,287 per month. This report was published in June 2025. Even though rent prices are still going up, they are not rising as fast as they did in the past few years. The rent increase over the last 12 months is just 2.8%, which is the slowest growth in 4 years.
Rent Prices Over Time
Here is a table showing how average rent and annual growth changed in the last few months:
| Month | Average Rent | Annual Growth |
|---|---|---|
| April 2025 | £1,287 | +2.8% |
| January 2025 | £1,279 | +2.7% |
| October 2024 | £1,278 | +3.3% |
As we can see, rents are still going up, but very slowly. A year ago, rent growth was over 6%, so this is a big drop.
Why Rent Is Growing Slowly Now
There are a few reasons for the slow growth in rent. First, fewer people are looking for rental homes. Demand has gone down by about 16% compared to last year. Still, demand is much higher than it was before COVID-19. One reason is that fewer people are moving to the UK for work or study. In 2024, net migration dropped by 50%, according to official data.
Also, more people can now buy homes, especially first-time buyers. Mortgage rates are more stable, and banks are making it a bit easier to get a loan. This is helping some renters leave the rental market and become homeowners.
Rental Supply Is Slowly Rising
Good news — there are more rental homes available now than last year. The number of available homes is up by 17%, and landlords are starting to buy more properties again as loan costs come down.
However, the overall supply is still 20% lower than it was before the pandemic. That means many renters are still competing for fewer homes, especially those with lower incomes. Renting is still hard for people who can’t afford to buy a house.
Rent Growth Slowing Across the UK
In almost every part of the UK, rent increases have slowed down. In some areas, rents are still rising a bit, but in other places, rents are actually falling.
- In Yorkshire and the Humber, rents are up just 1.1%.
- In Scotland, rent growth dropped from 9.1% to 2.4%.
- In cities like Sheffield, Bradford, and Leeds, growth is very low or negative. In fact, rents in Leeds are down by 1.5% compared to last year.
But in some cheaper areas near big cities, rents are still going up fast:
- Wigan: +8.8%
- Carlisle: +8.8%
- Motherwell: +8.3%
- Chester: +8.2%
- Blackburn: +8.0%
On the other hand, some expensive areas have seen a drop:
- North West London: -0.2%
- West Central London: -0.6%
- Dundee, Scotland: -2.1%
What Happened in 2022 and 2023
In 2022 and 2023, rent prices grew very fast. Cities like London, Manchester, and Birmingham saw big increases. More people were looking for places to rent, but there weren’t enough homes.
Now, things are slowing down. More Build to Rent buildings are being made, especially in cities. Plus, high rent prices are making it hard for renters to pay more, so landlords are not increasing rents too much anymore.
Rent vs House Prices
Rent prices have gone up much more than house prices in the last 3 years.
- Rent: +21%
- House prices: +4%
This happened because mortgage rates went up in 2022. Many people couldn’t afford to buy homes, so they stayed in rental homes. This pushed rent prices higher. Also, more people moved to the UK during that time, adding pressure.
Here is another table to show rent changes over 3 years:
| Year | Average Monthly Rent | Yearly Rent |
|---|---|---|
| 2022 | £1,067 | £12,800 |
| 2025 | £1,287 | £15,450 |
| Change | +£219/month | +£2,650/year |
This is the same increase that most people saw in mortgage payments. So even if you rent or own, costs went up either way.
What’s Next for Renters in 2025?
Experts believe rent prices will go up 3% to 4% in 2025, which is still above normal. In cheaper towns near cities, rent might rise more. But in expensive places, rent growth might slow down because some renters will start buying homes.
Still, for many people, buying a home is not possible. If someone earns a low or average income, it’s hard to save a big deposit or get a home loan. These people will stay in rental homes, where competition is still strong.
If they have to move, they might face even higher rents. That’s why policy makers need to focus on building more rental homes and helping people with lower incomes.
Conclusion
The UK rental market is cooling down, but renting is still expensive and hard for many people. Fewer people are moving to rent, and more homes are becoming available, but supply is still not enough. Rents are going up slowly, and in some places, they are going down. Still, renters, especially those with low income, face challenges.
The solution is clear: build more affordable homes and help more people become homeowners.
To stay updated with the latest rental trends and housing news, visit HousingMarketNews — your easy guide to what’s happening in the UK property market.
