London rents surge as inner postcodes see record rises

London is experiencing intense demand and high rent prices, according to a new survey.

Data by SpareRoom shows that inner London postcodes have recorded the highest rental costs, with Bethnal Green (E2) seeing the largest five-year rent increase in all of inner London, up 56%.

The findings come as the number of rental homes in the capital has fallen.

Room rents have risen disproportionately

According to the data, eight postcodes in London have seen rent increases of more than 50% in five years, including two more affordable parts of the capital, SE27 (West Norwood) and SE2 (Abbey Wood).

In Q4 2020, rents in E2 (£706 per month) landed below the average rent for London at that time (£721 per month). However, in 2026, rents here are 12% higher than the London average (£985 per month) at £1,104 per month.

Matt Hutchinson, director of flatshare site SpareRoom, said the figures show rents are rising across London.

He said: “Room rents have risen disproportionately all over the capital, but demand for cheaper pockets like West Norwood, most likely spillover from flatsharers priced out of places like Clapham and Streatham, is pushing up rents there. And the Elizabeth Line has had a bearing on above-average rent rises in Abbey Wood.

“It’s interesting that some hyper-central, expensive postcodes like the Strand and the West End have seen such steep increases when we usually see rents in cheaper areas rising fastest at times like this. It could be that people with higher incomes are being priced out of renting solo and are sharing more.”

Can’t afford to rent in inner London

Mr Hutchinson adds: “The broader picture in London is that intense demand from mid-2021, after the pandemic, forced rents sky high. Eventually, demand returned to normal but rents haven’t reverted. Some marginal falls in recent quarters, and from the record high in 2023 might sound positive, but only meaningful decreases would help people struggling with affordability.

“Today there are only a few London postcodes left with sub-£800 per month rents. It’s why we’re seeing more flatsharers exploring satellite and commuter towns around the capital. More and more people simply can’t afford to rent in inner London, even in shared accommodation.”

According to the findings, Londoners have felt the financial pressure of room rents rising from £721 per month at the end of 2020 to more than £1,000 per month in late 2023. While rents have since eased slightly, they currently stand at £985 per month, a 37% increase over the five years to Q4 2025.