Rent growth hits nine-month high – ONS

Average private rent growth has climbed to its highest level since December 2025, with the average UK monthly rent reaching £1,400 in August, the Office for National Statistics (ONS) reveals.

The annual increase edged up to 3.8%, from 3.7% in July, with London leading the charge.

In England, the average monthly rent reached £1,459, which is £56 more than a year earlier and an annual rise of 4.0%.

Wales recorded a 4.3% increase to £846, while Scotland’s average rose 1.1% to £1,013.

London rent growth rises

The ONS said: “This is the highest annual inflation rate since December 2025 and was mainly caused by a rise in London’s annual inflation rate, to its highest rate since October 2025.”

London’s annual rent growth increased from 3% in July to 3.5% in August.

The capital remained England’s most expensive region, with an average monthly rent of £2,332.

The North East and North West recorded England’s fastest annual rent growth, both at 5.8%.

That came despite the North East remaining the country’s cheapest region, with its average monthly rent at £788.

Growth in the North East eased from 6.3% in July, while the North West rate increased from 5.7%.

The South East remained at the other end of the table, although its annual increase edged up from 2.9% to 3.0%.

House price growth slows

The ONS has also revealed that house prices have continued to move more slowly, with the average UK price rising 1.4% over the year to July to £273,000.

That was down from annual growth of 1.5% in June and marked the third consecutive monthly slowdown in the annual rate.

England’s average house price reached £293,000 after increasing 1.1%, while Wales rose 2.6% to £215,000 and Scotland increased 2.3% to £196,000.

The ONS said: “The UK annual rate slowed for the third consecutive month because of a sharp slowing in the annual rate for the South West of England, with London and the West Midlands also contributing to the slowdown.

“This trend aligns with the Royal Institution of Chartered Surveyors’ July 2026 UK Residential Market Survey, which reported that UK-wide house prices continue to face a moderate degree of downwards pressure, particularly in London, and in the South West and the South East of England.”

Property sector reaction to ONS rent rise data

Nathan Emerson, the CEO at Propertymark, said: “Across the year, we have seen overall rental inflation generally slow down.

“However, that doesn’t take away from the reality of monthly rental costs continuing to rise year on year, albeit at a slower pace than previously.

“Based on today’s data, the average salary required for many people to rent a property typically sits at £42,000, which, in the current economic climate, represents a significant challenge for many.

“For many reasons, renting a property has become an ever-more-popular option across the UK, and it’s important that the sector attracts sustainable and continued investment to keep pace with growing demand.”

Alex Upton, the managing director of specialist mortgages at Hampshire Trust Bank, said: “Continued rental growth is masking some of the pressures landlords are dealing with at the moment.

“These figures follow HMRC data showing property rental income has reached a five-year high, which on the face of it should make the sector more attractive to quality investors.

“But the same data shows the costs associated with being a landlord have risen by 11% over the last year and by 56% over the last five years.”

Jeremy Leaf, a north London estate agent and a former RICS residential chairman, said: “The principal problem in the lettings market is the failure to replace the significant number of landlords selling up, mainly due to the increasing number of recently introduced tax and regulatory measures.

“As a result, we are unable to satisfy demand for larger flats and houses in particular, which is adding to upwards pressure on rents and an inevitable lowering in standards.

“In this climate, some landlords feel less pressure to improve properties especially as tenants can now give just two months’ notice under the Renters’ Rights Act.”

Jon Cooper, the director of mortgages at Aldermore, said: “Continued rental growth also keeps the issue of supply firmly in focus.

“Demand from tenants remains strong, but landlords are having to navigate rising costs and a more complex operating environment.

“It is important they have the confidence to remain in the market and invest, otherwise further pressure on the supply of rental homes risks making affordability and choice even more challenging for renters.”

Tom Bill, the head of UK residential research at Knight Frank, said: “The rental market continues to prove the law of unintended consequences, with upward pressure on rents following the introduction of the Renters’ Rights Act in May.

“Landlords are setting higher asking rents to reflect the greater risks they face in relation to void periods and rent collection.

“That is happening against the backdrop of falling supply as a series of tax and legislative changes in recent years have undermined the viability of letting property for landlords.”