Average private rents in Great Britain have slipped for the first time in five years, according to industry data, signalling a tentative pause in a prolonged period of steep increases. Hamptons’ lettings index found that the average rent on a newly let property fell 0.2% year‑on‑year in July, the first annual decline since August 2020; the change is small but notable because it breaks a sustained upward trend that has added materially to household budgets. According to the original report, this national figure conceals very different local experiences. (Aneisha Beveridge, head of research at Hamptons, described the market as having “paused for breath” in comments reported to The Guardian.)

The fall on new lets is modest in absolute terms and sits alongside other measures showing rents remain elevated. Hamptons and related datasets put the average monthly rent for a new let at roughly £1,370–£1,375, which remains about a third higher than in August 2020. At the same time, official figures show annual rent inflation has moderated rather than reversed, and renters continue to face substantially higher costs than five years ago.

Regional variation is stark. Greater London recorded the steepest decline in newly let rents — about a 3% annual fall in July and a seventh consecutive month of declines — while parts of Wales, the north‑east and Yorkshire and the Humber also saw falls. By contrast, seven of the 11 regions monitored still recorded annual increases, with the East Midlands, West Midlands and the south‑west among the strongest. The differing patterns between the capital and many provincial areas help explain why a small national fall can coexist with rising rents in large parts of the country.

Several structural and cyclical forces explain the easing. Industry analysts point to recent cuts in Bank of England interest rates over the past year that have reduced mortgage costs for some buy‑to‑let landlords, lessening their immediate need to pass on higher financing costs to tenants. Lower mortgage rates have also improved affordability for would‑be buyers, prompting some renters to return to owner‑occupier searches and easing pressure on demand in parts of the lettings market. At the same time, property platforms report a rising supply of available lets — Rightmove estimates the number of listings is roughly 15% higher than a year earlier — and a fall in tenant‑to‑listing competition, which has contributed to slower growth in asking rents.

That loosening does not extend to everyone. Renewal rents — the sums charged when sitting tenants sign a new tenancy — continued to rise, up around 4.5% year‑on‑year in July, according to Hamptons, meaning many existing tenants are still seeing significant cost increases even as advertised new‑let rents cool. Hamptons’ own analysis warns that persistent supply shortages and forthcoming regulation could re‑introduce upward pressure on rents over the medium term, limiting how far and how fast rents can fall.

Official statistics provide a complementary perspective and slightly different measures. The Office for National Statistics’ provisional bulletin for June 2025 records the average UK private rent at about £1,344, with London remaining by far the most expensive area (average rents approximately £2,252) and the North East showing one of the strongest rates of annual inflation. The ONS release stresses methodological caveats and regional breakdowns, underscoring that short‑term movements can look different depending on whether the focus is on newly let properties, asking rents, or renewals — and on the sample of agents and platforms used to compile indexes. Industry bodies such as Connells Group, which supplies a large volume of transaction and listing data to market trackers, underpin many of these indexes, reflecting the scale and commercial reach behind the figures.

The ownership and investor landscape is also shifting. Hamptons reports that one in five buy‑to‑let companies set up in Britain so far this year has at least one non‑UK shareholder, up from around 13% in 2016, with investors from India, Nigeria, Poland and Ireland among the largest non‑UK groups. The company adds that Brexit has altered the composition of foreign ownership, with the share originating in the EU declining since 2016. Meanwhile, mortgage and housing‑cost analyses from lenders show housing remains the single biggest item of spending for many households: Barclays’ research, summarised by industry press, estimates housing now typically accounts for close to a third of renters’ take‑home pay, compared with just over a quarter for homeowners.

Looking ahead, forecasters and portals have adjusted expectations but remain cautious. Hamptons has downgraded its rental growth forecast for 2025 significantly — reflecting the weaker momentum across new lets — while Rightmove reports record asking rents in some areas even as the pace of growth slows, listings increase and homes take longer to let. The emerging picture is one of an unsettled market: a modest national cooling that offers relief to some prospective tenants, but an environment in which renewal rents, regional imbalances, supply constraints and regulatory change could keep pressure on many households for the foreseeable future.

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Source: Noah Wire Services