Rents rise 6.7% in June while house prices grow by 3.9%

Private rents across the UK have continued their upward trajectory, with the Office for National Statistics (ONS) reporting a 6.7% rise in average monthly prices, but the rate of increase is slowing down.

It says they hit £1,344, in the 12 months to June, which is a slight easing from the 7% increase recorded in the year to May.

This is the sixth consecutive month of slowing rental inflation.

In England, tenants faced an average rent of £1,399, up 6.7% from the previous year.

Wales saw a sharper increase, with rents climbing 8.2% to £804, while Scotland recorded a modest 4.4% rise, bringing average rents to £999.

Northern Ireland, with data available up to April 2025, reported a 7.6% increase, pushing average rents to £852.

Regional disparities were evident in England, where the North East experienced the steepest rental inflation at 9.7%, and rents in Yorkshire and the Humber saw the smallest increase at 3.5%.

Latest UK house prices

The UK’s house prices grew by 3.9% in the year to May, reaching an average of £269,000, the ONS data shows.

This uptick follows a 3.6% rise in the year to April, though price growth was tempered by a dip in the price index between March and April, influenced by changes to Stamp Duty Land Tax (SDLT) introduced on 1 April.

England’s average house price stood at £290,000 in May, a 3.4% increase (£9,000) compared to the previous year.

Wales reported a 5.1% rise, with homes averaging £210,000, while Scotland saw a 6.4% increase, bringing the average to £192,000.

Northern Ireland recorded the strongest growth, with house prices up 9.5% to £185,000 in the first quarter of 2025 compared to the same period in 2024.

Property sector reaction to the ONS rent data

Gareth Atkins, Foxtons‘ managing director of lettings, said: “The London lettings market showed strong signs of stability in June, with applicant numbers rising 21% from May and new listings at their strongest level in four years.

“This increase in supply is helping to ease pressure on renters, as seasonal demand increases, and with more applicants in the market, good Landlords will see strong demand across the capital.”

Sarah Coles, the head of personal finance at Hargreaves Lansdown, said: “The relentless drum beat of misery for renters goes on.

“However, it has softened from a kettle drum to a bass drum, so while it’s still causing renters to reel, the impact isn’t quite so dramatic.

“There are some signs of more balance returning to the market, and although recent RICS data showed landlords are still selling up, the number of tenants is holding steady.”

Louisa Sedgwick, the managing director of mortgages at Paragon Bank, said: “The cooling of rent inflation is a step in the right direction, but at 0.3% percentage points, it’s a small step and comes from the record high recorded last year.

“This means that rents are still increasing at a faster rate than they were before the pandemic, driven by the continued imbalance between supply and demand for rental homes.

“Over the long term, projected demographic changes and population growth is likely to propel demand for rented homes.”

Alex Upton, the managing director of specialist mortgages and bridging at Hampshire Trust Bank, said: “Rents are still rising, but the pace has eased compared to last year.

“The mismatch between supply and demand remains the main driver, although there are early signs of the market starting to rebalance.”

Richard Donnell, the executive director of research at Zoopla, said: “The growth in rents is slowing as affordability pressures build, the level of immigration slows and the easing in mortgage regulations makes access to home buying easier for renters on higher incomes.

“Rents for new lets, which lead the ONS index are increasing at the slowest pace for four years.”

Nathan Emerson, the chief executive of Propertymark, said: “Investors in the private rental market have been deterred from investing in this crucial housing market because of tax and regulatory changes over the last 10 years, and now recent reports suggest that they have been deterred further by Stamp Duty increases on second homes.

“Britain needs a stable and thriving private rental market to provide choice to people who intend to put a roof over their heads.”

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