Average rents outside London rose by 1.9% in the second quarter after a fall in available properties, the latest index from Rightmove reveals.
The average advertised rent outside the capital reached a record £1,397 per month in Q2, which was 2.3% higher than the same quarter last year.
In London, rents rose by 2% in the second quarter, reaching a new high of £2,791, which was 2.9% higher than last year.
Helping to drive the price increase was the first annual fall in rental housing available since 2022.
Rightmove says rental stock is now 1% lower than last year, as fewer properties have come on the market.
Despite the reduction in supply, employer competition remains below post-pandemic highs, the site said.
The average rental property now receives 10 inquiries, compared to 11 last year and 22 at the market’s peak in 2022.
Rightmove’s Mortgage Tracker shows average two-year fixed rates without a charge fell to 5.55%, down from 5.67% last month, although still above the 5.2% recorded last year.
The report found that annual rent growth remains strongest in the north of England, with the North East and North West recording annual increases of 4.1%, compared to 1.5% in the East Midlands and East of England.
Rightmove says the figures are the first to reflect market conditions following the introduction of the Tenants’ Rights Act in May and that trends currently appear stable and broadly in line with seasonal trends.
Rightmove property expert Colleen Babcock says: “We are seeing record new rents being advertised in London and across Britain outside the capital, however, we are seeing rents returning to normal seasonal patterns and steady growth.
“Although supply is not growing, the market is still more balanced than it was at the peak of competition in 2022.
“Regional trends also continue to vary widely across the country, with more affordable northern areas still seeing strong rent growth.
“London saw a significant increase in rents this quarter, as well as a sharp drop in available rental properties, underscoring how the supply of space and energy demand continue to drive rental prices.”
Association of Residential Letting Agents Propertymark president Kim Lidbury says: “While headline rent growth is still modest compared to the high prices seen in recent years, the fall in newly listed rental properties should not be ignored.
“If fewer landlords bring properties to the market in a stable period, this risks creating a persistent supply challenge that could put upward pressure on rents in the coming months.
“The data also reinforces the importance of professional property management in a changing market.
“As regulatory requirements continue to evolve, landlords who receive expert advice and invest in quality housing maintenance are more likely to retain tenants, reduce costly downtime and support a stable rental sector. Increasing confidence in responsible landlords to stay in, or enter, the market will be essential if the sector is to meet long-term housing needs.”
