Rents fell in January but tenant affordability pressures remain

Rents fell in most UK regions in January, signalling a clear post-Christmas slowdown, but the cost of accessing rented housing remains stubbornly high when set against earnings.

Propertymark’s latest rent price and salary tracker shows month-on-month declines across much of the country.

The sharpest drops were recorded in the North East at −10.0%, followed by the South West at −8.1%.

Yorkshire and Humberside saw a fall of 7.4%, and Wales at −6.1%.

It says the figures point to cooling tenant demand after the festive period, with landlords adjusting expectations in response to quieter market conditions.

Tightening supply issues

The president of ARLA Propertymark, Megan Eighteen, said: “January’s data points to a rental market that is clearly responding to seasonal demand dynamics, with widespread month-on-month rent reductions signalling increased price sensitivity among tenants and a softening of competition in many regions.

“However, this short-term easing should be viewed in context.

“Despite notable monthly declines, the annual salary required to secure a rental property has remained broadly stable or increased in several areas, underlining that affordability pressures remain deeply embedded.”

She added: “Structural issues, particularly constrained supply, continue to limit the extent to which falling rents can deliver sustained relief for renters.”

Tenant affordability stalls

The data shows that tenant affordability has shown little meaningful improvement.

Salary requirements linked to securing an average rental home shifted marginally year on year,.

London’s rents rose 3.7% compared with December, pushing the average monthly cost to £2,204.

However, the representative annual income needed to secure a property eased to £66,120.

Rent rises vary

Across the rest of the UK, the picture was mixed with average rents in January standing at £1,491 in the South East and £1,363 in the South West.

Tenants in the East of England faced £1,324.

More affordable regions included the North East at £894 and Northern Ireland at £913.

Salary benchmarks reflected similar regional divides.

Renters typically needed £44,730 in the South East and £40,890 in the South West, compared with £26,820 in the North East.