Average rents outside London have fallen for the first time since the pandemic, according to a report by property website Rightmove released on January 28, 2025. The decline, recorded in the final quarter of 2024, shows a 0.5% drop compared to the previous quarter. This marks a significant shift after years of rent increases driven by high demand and limited housing supply.
Rightmove noted that the decrease is partly due to increased rental stock as more landlords re-entered the market. Tim Bannister, Rightmove’s Director of Property Data, stated, “The rise in available properties has provided renters with more options, which has helped ease upward pressure on rents.” However, average rents remain 10% higher than in 2022, reflecting long-term supply issues.
The most significant declines were seen in cities such as Manchester and Birmingham, where rents had surged in recent years. More properties have become available in these areas due to buy-to-let investors responding to a more muscular market earlier in 2024. “It’s a relief for tenants struggling with affordability, but the overall market remains tight,” Bannister added.
London’s rental market continues to show resilience, with rents in the capital rising by 1.2% during the same period. High demand for housing in London, driven by professionals and international students, has kept rents elevated. Rightmove’s data highlights the stark contrast between London and the rest of the UK, where affordability challenges are easing slightly.
Despite the fall in rents outside London, affordability remains a concern for many renters. The average monthly rent outside London now stands at £1,162, a drop from the peak of £1,168 earlier in 2024. Bannister cautioned that while the drop is a positive sign for renters, “it’s too early to say whether this will develop into a longer-term trend.”
Landlords have faced challenges, including higher mortgage rates and increased regulatory costs. Some have been forced to lower rents to attract tenants in a more competitive market. “Landlords are under pressure to balance rising expenses while staying competitive,” said one property owner in Manchester.
Economists believe that the cooling rental market may reflect broader economic trends. Slower wage growth and rising living costs have dampened renters’ ability to pay higher rents. “This adjustment is partly a reflection of economic pressures facing households,” said Helen Marshall, a housing economist at Oxford Economics.
The report suggests rental price trends will depend on housing supply, mortgage rates, and economic recovery. While renters may benefit from temporary relief, experts warn that long-term solutions, such as increased housebuilding and better regulation, are necessary. The government has pledged to address housing affordability, but progress remains slow.
The rental market’s first decline in years offers hope for renters, but the path to affordability remains uncertain. Policymakers and market players must address structural challenges to ensure sustainable housing solutions in the UK.
