England witnesses a 28% hike in rental prices
England's Rental Market Remains High, with Modest Growth in July 2025
The rental market in England continues to evolve, with rents remaining high but showing a slight decrease in some areas compared to pre-pandemic levels. According to Goodlord's latest rental index, the average UK rent in July 2025 was £1,313, with rents outside London averaging £1,132 per month.
Rents in Greater London, however, remain high, albeit with a year-on-year decrease of about 0.9%. The average rent reached £1,954 last month, which is significantly higher than the £851 charged in the North East of England.
Nationally, average private rents increased by 5.9% in the 12 months to July 2025, although this is a slowing from earlier peaks of 6.7% annual growth. Some regions, like the North East and East Midlands, show smaller increases or slight decreases month-on-month but still record modest growth compared to 2024.
The increased demand for rental housing, coupled with limited housing supply, has driven rents upward. Over a third of UK households now rent, and the rental market has tripled in size since before the pandemic. Cities with high renter populations include Manchester (62%), Tower Hamlets in London (74%), and others with strong young adult demographics (Nottingham, Cambridge, Oxford, Exeter).
The surge in demand is partly due to affordability issues in home buying and changing lifestyle preferences after the pandemic. Economic inflation and cost pressures, such as rising maintenance costs, taxes, and mortgage interest rates, also contribute to higher rents. Rent and mortgage spending increased 5.2% year-on-year as of July 2025, affecting tenant affordability.
Urban demand concentration, particularly in major cities and financial or political centres like London and Manchester, also commands higher rents due to strong employment opportunities and amenities. Demographic factors, such as areas with higher proportions of young adults and university populations, also see greater rental demand and rent growth.
William Reeve, Goodlord's chief executive, stated that rent rises have consistently outstripped inflation. Since 2020, rents have shifted rapidly, with rents in England increasing by over 6% compared to year-on-year figures. Despite the recent slowing in the pace of rent increases, the overall trend remains one of rising rent costs in 2025 compared to before 2020.
Voids were unchanged month-on-month, with the number of days a property is vacant in between tenancies holding at 18 days. The rental market in April 2024 demonstrated a brief respite in the pace of rent increases compared to the previous months, but the trend has since picked up again.
In summary, the rental market in England remains high, with rents increasing significantly since the pre-pandemic period due to expanded renter demand, supply shortages, inflationary pressures, and concentrated urban demand especially in major cities with large young adult populations. While some regions show modest fluctuations month to month, the overall trend remains one of rising rent costs in 2025 compared to before 2020.
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