Gloomy forecast for tenants as rent rises set to speed up
Summary
Rent prices for new leases in the UK rose by 2.6% in July compared to last year, with predictions that rent increases could reach 4% to 5% by the end of the year. This rise is driven by fewer rental homes available and more people competing for them, partly because higher mortgage rates discourage first-time buyers from buying homes.Key Facts
- UK rental costs have increased after three years of slower growth.
- Average rent for new tenancies rose 2.6% in July compared to a year earlier.
- Rents are expected to rise by 4% to 5% by the end of the year.
- There are 3% fewer rental homes available now than a year ago.
- Each rental listing gets about five inquiries, showing stronger competition.
- London has a particularly high demand for rental homes.
- Housing supply for rent is low partly due to higher costs and stricter rules for landlords.
- More investment is needed to build rental homes to stabilize prices and increase tenant choice.
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