Record Average Asking Rent Reaches £1,291 Outside London

Average asking rents outside London hit a new high of £1,291, with rates doubling to £2,633 in the capital. Stay informed on the latest trends.

Average asking rents have once again hit a new high, underscoring the challenging environment for tenants. According to data from Rightmove, the average asking price for rental properties outside of London rose to a record £1,291 per month in the first quarter of 2024, marking the 17th consecutive quarterly increase. This represents an 8.5% year-on-year rise, although the rate of growth has been slowing over the past two quarters.

In London, average rental asking prices also reached a new peak, climbing by just £2 to £2,633 per month. This translates to a 5.3% increase compared to the same period last year. Despite the record-high prices, there is a silver lining for tenants as the pace of rental growth has moderated from the peak levels seen in 2022.

The scarcity of available rental properties coupled with strong demand has been a key driver behind the rising prices. While the number of rental properties on the market has increased by 11% compared to last year, it remains 26% below pre-pandemic levels. Meanwhile, tenant demand remains robust, standing at 54% higher than in 2019, although it has dipped by 17% from a year ago.

Letting agents are struggling to keep up with the high demand, with an average of 13 enquiries per rental property. Although this is lower than the 19 enquiries seen a year ago, it is still significantly higher than the pre-pandemic average of five enquiries in March 2019.

The affordability of current rental prices is a growing concern, with Rightmove noting that tenants are facing significant financial strain. This is evidenced by the increasing number of price reductions, which are currently at a five-year high for this time of year. Approximately 22% of rental properties have seen price reductions, up from 16% a year ago.

The recent passing of the Renters Reform Bill has added a new layer of uncertainty for both landlords and tenants. The Government's decision to delay the ban on Section 21 notices until a review of the court systems has been completed has raised concerns among landlords. Section 21 notices allow landlords to evict tenants without providing a reason, and the potential ban has sparked fears of landlords exiting the market and selling their properties.

The rental market continues to face challenges as prices reach new highs, supply remains constrained, and affordability concerns grow. The evolving regulatory landscape adds further complexity to an already competitive market, with implications for both tenants and landlords.