The huge rises in rents of recent years are finally coming to an end, with rent rises falling to their lowest level since July 2021, Zoopla’s Executive Director of Research, Richard Donnell (pictured) has claimed.
His latest report reveals the average rent for a new let has increased by just 2.8% during the 12 months to April 2025, less than half the rate of rental growth recorded a year ago (6.4%). The average monthly rent now stands at £1,287, up just £35 over the past year.
Market pressures unchanged
Angharad Trueman, President, ARLA Propertymark
But Angharad Trueman, President of ARLA Propertymark warns that the underlying market pressures remain unchanged.
“It’s interesting to see that rent growth has slowed year on year. This is more than likely down to rent levels reaching their peak in many places across the UK, as they have been rising to unrealistic levels for years.”
She adds: “From the outside looking in, it may look as though landlords and their greed are at the heart of this problem, however, this is not the case.
“A significant number of landlords face increased costs across the board, from continuous legislative hurdles, tax hikes, and mortgage increases, many are struggling to break even on their costs.”
Supply shortages persist
The data also shows that although rental demand may have fallen by 16% over the last year, the market continues to face significant supply constraints. And, despite being 17% higher than a year ago, the number of homes available for rent remains 20% lower than pre-pandemic levels.
Trueman points out: “The bombardment and penalisation of landlords is pushing many to leave the market altogether or prohibit new investors from entering, which is creating an ever-growing undersupply of private rented homes against a backdrop of increasing demand from renters.”
It’s crucial that support is available and incentives are introduced for investment.”
He concludes: “It’s crucial that support is available and incentives are introduced for investment moving forward in order to make private rented housing more affordable in the long term.”
Zoopla is predicting UK rents will increase by 3-4% over the remainder of 2025.