Rents Set to Soar as Tenant Demand Rises
Buy-to-let rents are set to soar as record numbers of tenants chase a dwindling number of homes, claim property experts.
The latest lettings report from the Royal Institution of Chartered Surveyors (RICS) shows rising tenant demand, but new landlord instructions have dropped sharply.
The report argues that the imbalance of rising demand and falling supply will likely lead to higher rents over the next three months.
New data from the Office for National Statistics (ONS) shows the average rent in England was £1,348 in October - an 8.8 per cent or £105 increase from a year earlier. This is 0.3 per cent more than in September but below the peak of 9.1 per cent recorded in March.
In Wales, rents were up 7.9 per cent (£56) in the year to October, down 0.4 per cent from September. Wales's annual inflation rate has been generally slowing since the record-high annual rise of 9.8% in November 2023, says the ONS.
How UK rents have changed in the 12 months to October 31 this year, according to the ONS:
| Region | Annual percentage change |
|---|---|
| London | 10.40% |
| North West | 9.70% |
| East Midlands | 9.10% |
| West Midlands | 8.70% |
| South East | 8.20% |
| East of England | 8.00% |
| North East | 7.70% |
| South West | 6.20% |
| Yorkshire and The Humber | 5.90% |
| UK | 8.70% |
| England | 8.80% |
| Wales | 7.90% |
Source: ONS
Homelet Data
For the year to October, Homelet calculates rents rose by 3.4 per cent to £1,327 a month - £21 below the ONS figure. Rents were most expensive in London, where tenants pay an average of £2,211 monthly. The cheapest rents are £709 a month in the North-East.
| Region | Rent October 2024 | Rent September 2024 | Rent October 2023 | Yearly change |
|---|---|---|---|---|
| London | £2,211 | £2,201 | £2,192 | 0.90% |
| South East | £1,421 | £1,431 | £1,370 | 3.70% |
| East of England | £1,301 | £1,309 | £1,216 | 7.00% |
| South West | £1,197 | £1,213 | £1,140 | 5.00% |
| North West | £1,069 | £1,068 | £1,016 | 5.20% |
| West Midlands | £1,020 | £1,014 | £937 | 8.90% |
| Wales | £911 | £914 | £863 | 5.60% |
| Yorkshire and Humberside | £904 | £898 | £875 | 3.30% |
| East Midlands | £891 | £887 | £869 | 2.50% |
| North East | £709 | £720 | £677 | 4.70% |
Source: Homelet
Consultants at international property firm Knight Frank express uncertainty about how rents might change, fearing the Renters Rights Bill may tip the market in favour of tenants.
“We don’t expect supply to drop, but Rightmove data shows new rental listings are a fifth below pre-pandemic levels and, combined with the uncertainty of the Renters Rights Bill, we expect rental growth between 2025 and 2029,” says the report.
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