UK’s rental market soars: Record highs and regional disparities

UK’s rental market soars: Record highs and regional disparities

0:05 AM, 5th June 2023, About 6 months ago 4

Text Size

Landlords and tenants in the UK have witnessed average rent costs for a new tenancy rocketing by 10% year-on-year, reaching £1,213, research reveals.

The Homelet rental index for May also reveals that the monthly rise in rent last month was 1.2%.

The data highlights that a surge in rental prices is evident across most regions and when London is excluded, the average rent is still 9.5% higher than it was a year ago, standing at £1,016.

London has seen an astounding 11.3% annual growth

The capital has seen an astounding 11.3% annual growth, with a 1.8% increase since last month, taking the average rent to £2,039 – the highest rent figure ever recorded by the index.

In contrast, the North East has experienced a decline in the average rent price with a 2% drop, bringing the average down to £632.

The chief executive of HomeLet and Let Alliance, Andy Halstead, highlights the risks involved for both tenants and landlords due to the high rental prices.

He recommends that landlords consider rent guarantee insurance as more tenants may struggle to pay their rent each month.

‘The level of demand somewhat depends on location’

Mr Halstead adds: “The fact that the London market is rising in terms of average price while the cheapest area in the country (North-East of England) is falling shows that the level of demand somewhat depends on location, but as a broad rule, there is a shortage of rental properties to meet demand, with many prospective tenants facing a real battle to secure a property.”

He is also predicting that with so much competition from tenants, the UK’s heated rental market will probably cause rent prices to continue their upward trajectory in the coming months.

Share This Article


Ross Tulloch

9:50 AM, 5th June 2023, About 6 months ago

I wonder if the London Mayor has considered his wish to bring in rent controls will have made many landlords increase rents more than they might have done while they can, because of this threat in the future, which itself would do more harm long term than good, as it has done elsewhere.


11:19 AM, 5th June 2023, About 6 months ago

Reply to the comment left by Ross Tulloch at 05/06/2023 - 09:50
Some landlords will still be worse off even with those rent increases. With maintenance, financing and admin costs also 'soaring'.

If you bring in rental controls, many of those landlords may well call it a day. And there will be even fewer rental properties in the private rental sector.


12:00 PM, 5th June 2023, About 6 months ago

Reply to the comment left by Ross Tulloch at 05/06/2023 - 09:50If the London mayor does bring in rent controls he needs to look at what the effect of that has been in Scotland.
This Scottish housebuilder reported that it was putting affordable housing and build to rent schemes on hold.


14:15 PM, 5th June 2023, About 6 months ago

I have already raised my rents in anticipation of this scenario with Khan and Labour coming to power next year so if your baseline rent is not high enough to withstand a max of 'SNP style' 3% rent cap after a two year freeze then you really have to make bigger decisions now about selling in the next 18 months as Labour will bring in CGT to 40% minimum in their CoL (cost of living) 'emergency budget' as they ideologically see housing as a right not a trading asset! Don't worry they will only be in for one term (5 years) after the damage they will do to PRS if you can take that stress/pressure!! It's going be be a very rough ride. So contingency plan NOW. I.e. Expect unearned rental income to be taxed higher too! Therefore I will probably sell when Labour get kicked out of power as I will only rely on capital growth benefit only as rental income will be didly squat by the time they leave, So go through your number . This calculator was developed by another P118 reader and it is very useful to plan scenarios

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership


Don't have an account? Sign Up

Landlord Tax Planning Book Now