Rents hit new record, as average property receives 17 enquiries

• Average advertised rents outside of London rise to a new quarterly record of £1,314 per calendar month (pcm), now 7% higher than last year (£1,231 pcm)
  • London rents have also risen to a new record of £2,661, now 4% higher than last year (£2,567 pcm), with rent growth steadily slowing since the peak of 16% in 2022
• The number of enquiries each property is receiving from would-be tenants is now 17 which, whilst down from 26 in 2023, is more than double the 8 at this time in 2019:
  • Despite overall rental supply slowly improving from last year (+14%), the number of rental properties available is still 20% below pre-pandemic levels
  • Tenant demand is down 16% compared to last year, however, 22% more tenants are looking to move than in 2019
• There have been some early positive signs from the new government regarding improvements in the rental market for tenants, however, Rightmove suggests more support is needed for landlords to invest in good quality homes for the private rented sector

The average advertised rent of new properties coming onto the market hits a new quarterly record, with the average price outside of London now £1,314 per calendar month (pcm).

Average rental prices are 7% higher than a year ago, slowing from a peak of +12% in 2022.

Average advertised rents in London have also risen to a new record of £2,661, now 4% higher than last year, compared with the peak of 16% in 2022.

The overall balance between supply and demand has continued to improve during the second quarter of this year. However, the latest snapshot of the rental market highlights how busy it remains compared to more normal levels seen pre-pandemic – meaning both letting agents and tenants are unlikely to feel any improvements yet.

The number of enquiries each rental property is receiving from would-be tenants is now 17 which, whilst down from 26 this time last year, is more than double the 8 at this time in 2019.

The slowing in number of enquiries per property is driven by more rental properties becoming available, and fewer tenants looking to move.

The number of available properties is currently 14% higher than this time last year, while tenant demand is down 16% compared to last year.

However, despite these improvements, there is still a way to go to reach pre-pandemic supply and demand levels. The number of available homes to rent is still 20% below 2019, while 22% more tenants are looking to move than in 2019.

A recent Rightmove study showed that around 120,000 more rental properties are needed to bring rental price growth back towards more normal pre-pandemic levels of around 2-3%, based on current demand.

There have been some early positive signs from the new government regarding improvements in the rental market for tenants.

Labour has pledged to get 1.5 million more homes built, which could improve the availability of rental properties for tenants if some go to the private rented sector, or more tenants can become first-time buyers.

Rightmove is also calling for further support from the government for landlords to encourage investment in the private rented sector, particularly any help with making properties more energy efficient. A balanced approach to the rental market that acknowledges the importance of landlord investment will ultimately benefit tenants, providing them with a broader choice of higher-quality homes.

Rightmove’s Director of Property Science Tim Bannister says: “With 17 enquiries for every available rental property, the market remains out of balance and difficult for tenants. We need landlord investment to increase stock and help achieve a healthier supply and demand balance in the market. There is an opportunity to encourage landlords to continue to invest in good quality homes, for example through tax changes, incentives to help with energy-efficient upgrades or a general sentiment change in government towards working alongside and with landlords. Landlords have previously told us that the government’s perception of landlords is one of their main concerns about the sector. Support for both tenants and landlords will be key to achieving long-term stability in the rental market.”

Agent’s views

Lucy Beasley, Lettings Manager at Jones Robinson in Newbury said: “Recently, we have observed an increase in available properties coming to market, but we haven’t noticed much of a reduction in demand from tenants which remains robust. Rents are still high for many, and we have noticed that larger properties sometimes need to reduce their prices to secure tenants. While rents are showing a slight decrease this year, they are still above where they were two years ago, with many tenants facing an affordability blocker when looking for homes to rent.”