London rents rise 39% in 10 years, but only 0.7% after inflation

While London’s rents appear to have undergone a dramatic 39.2% surge over the 10 years, the real-terms increase is just 0.7%, research reveals.

The study by lettings and estate agents Benham and Reeves, found that rents grew from £1,616 in May 2015 to £2,249 in May 2025.

However, when factoring in inflation the actual increase is just £15 more per month.

And that, the firm says, challenges accusations that landlords alone are responsible for rising rents.

Inflation is pushing up rents

Marc von Grundherr, a director of Benham and Reeves, said: “There’s a widespread perception that landlords are to blame for the sharp rise in rents, particularly in London, but the data tells a very different story.

“Once inflation is taken into account, rental growth over the last 10 years has been largely stagnant and, in many areas, rents have actually fallen in real terms.

“This underlines the real issue in the rental sector: a severe mismatch between supply and demand.”

He added: “Landlords face higher mortgage costs, tighter regulations and increasing taxation, yet many are not passing those costs on at the rate people assume.

“If anything, this data highlights the need to support landlords, not vilify them, if we want a functioning private rental sector.”

London rents adjusted for inflation

The analysis examined rent data across all 32 London boroughs over the decade, comparing nominal price changes to those adjusted using the Consumer Prices Index (CPI).

The findings indicate that economic pressures, rather than landlords are profiteering, are behind the rising costs tenants face.

Significant variations exist across the capital with Barking and Dagenham leading with a 16.5% real-terms increase, adding £229 monthly.

Havering followed closely with a 16.3% rise (£211), while Bexley, Redbridge and Waltham Forest saw gains of 14.3% (£182), 12.0% (£180) and 7.4% (£120), respectively.

Not all boroughs saw rises

However, several high-end boroughs experienced declines in real terms and Westminster rents dropped by 4.9%, a £168 monthly decrease.

Richmond upon Thames, Camden, Kingston upon Thames, and Kensington and Chelsea also saw reductions of 3.9%, 3.1%, 2.8% and 2.3%, respectively.

Overall, 12 boroughs reported real-terms rent price falls, highlighting inflation’s role in shaping perceptions of rent growth.