In the last quarter of 2023, the average monthly rent outside of London soared to a record £1,280, marking a new high, as reported by property website Rightmove. The data from Rightmove’s index, covering the entire UK, revealed that estate agents are currently fielding around 11 inquiries per available rental property. While this surge in rents has been significant, Rightmove anticipates a slowdown in rental growth throughout 2024.
The final quarter of 2023 witnessed the smallest quarterly increase in asking rents since 2019, registering a modest 0.2% uptick. This subtle rise suggests a deceleration in the pace of rent increases. There are indications that tenants are approaching their financial limits, with nearly a quarter (23%) of rental properties requiring a reduction in the advertised rent. This is notably higher than the 16% reported a year earlier.
On average, advertised rents in the last quarter of 2023 were 9.2% higher than the previous year. While this constitutes a significant increase, Rightmove notes that it represents the lowest annual growth in rents observed since 2021.
London, too, witnessed a surge in asking rents, reaching an average of £2,631 per month—a record high. The quarterly increase was 0.2%, and the rents were 6.1% higher than the same period a year earlier. This marks the first time since 2021 that annual growth in asking rents in London has remained in single digits.
Looking ahead, Rightmove projects a 5% increase in rents outside London by the end of 2024, while London is expected to see a more moderate 3% rise. These projections indicate a potential shift towards a more stabilized rental market compared to the recent period of rapid growth.