Rents Hit New Heights
In Q1 2025, the rental market outside of London saw average advertised rents reach a new high of £1,349 per calendar month. This marks a 4.5% increase compared to the same period in 2024. While this is a notable rise, it’s important to note that it’s the smallest increase at this time of year since 2020, suggesting that the rate of rent growth might be stabilising.
Meanwhile, rents in London continue to soar, hitting a 14th consecutive record high. The average rent in the capital is now £2,698 per month, reflecting a 2.5% increase year-on-year. Although this increase is smaller compared to previous years, it still underscores the ongoing demand for rental properties in the city.
Supply Sees a Positive Shift
One of the brighter spots in this report is the continued improvement in rental property supply. In March 2025, the number of new properties coming onto the market was 11% higher than the same period last year. Overall, the total number of available rental homes is up by 18%, which is a positive sign for prospective tenants who may have faced scarcity in recent months.
That said, demand is starting to show signs of softening. The number of prospective tenants looking to move has dropped by 7% compared to last year. An increase in first-time buyer activity in early 2025 is likely pulling some potential renters toward the property purchase market, further contributing to the cooling of rental demand.
Enquiries Per Property Decline
Another notable trend this quarter is the decline in the average number of enquiries per rental property. Outside of London, properties are receiving an average of 12 enquiries—down from 16 in Q1 2024. This represents a more balanced market compared to last year’s more competitive conditions. For context, the number of enquiries is still much higher than in Q1 2019, when the average was just five.
However, this trend is not uniform across the country. In London, for instance, the average number of enquiries per property is just eight, while in regions like the North West, typical rental homes are seeing 18 enquiries. These regional variations highlight the differing levels of demand and competition across the UK rental market.
Price Reductions Are More Common
Interestingly, a growing number of rental properties are seeing a reduction in their advertised prices. Approximately a quarter of rental properties are now seeing a price cut—this is the highest proportion at this time of year since 2018. This trend suggests that the market may be becoming less frantic, as landlords adjust to slower demand and try to attract tenants with more competitive pricing.
What This Means for Renters and Landlords
For renters, this report offers a mixed bag. While rents are still on the rise, the rate of increase has slowed compared to previous years, and the improvement in supply means that more options are becoming available. The slight dip in tenant enquiries could also signal less competition, giving renters more leverage in negotiations.
For landlords, the cooling of tenant demand and the increase in rental price reductions suggest a shift toward a more balanced market. While rents are still higher than ever, it’s important for landlords to keep a close eye on price trends and adjust their expectations accordingly.
Looking Ahead
The overall picture in Q1 2025 is one of gradual stabilisation in the UK rental market. Although rents are still increasing, the pace has slowed, and supply is improving, providing more opportunities for tenants. Landlords may need to adjust to a market that is becoming less frenzied, with price reductions and fewer enquiries per property becoming more common.
As we move further into 2025, it will be interesting to see how these trends evolve. Will the cooling of demand continue, or will rising rents once again drive competition to new heights? Only time will tell.
Source: All data taken from the RM Quarterly tracker report issued 29/04/2025
