📈 Q2 2025 Rental Market: Signs of Stabilisation Amid Record Highs
Despite hitting record-high rental prices again this quarter, the UK rental market is beginning to show signs of rebalancing. The Rightmove Rental Trends Tracker for Q2 2025 highlights a market transitioning out of its post-pandemic frenzy and moving toward more sustainable conditions for both tenants and landlords.
1. Rents Reach New Highs – But Growth Is Slowing
The average asking rent outside London has reached a new high of £1,365 per month, with London hitting a record £2,712 per month. While these numbers represent historic peaks, the pace of rent growth is cooling, now at its slowest annual rate since 2020. In fact, average rents are only up 1.2% quarter-on-quarter outside London and 0.5% in the capital, compared to much steeper increases seen during 2021–2022.
2. Supply and Demand Are Finally Balancing
After years of tenant competition and housing shortages, the market is beginning to recalibrate:
Rental listings are up 15% compared to this time last year.
Tenant demand is down 10%, giving renters more choice.
On average, each rental property now receives 11 enquiries, down from 16 a year ago.
These shifts are making a noticeable difference. Properties now take an average of 25 days to let, up from 21 days in 2024. Nearly a quarter (24%) of listings are also seeing price reductions, the highest level since 2017.
3. Investor Activity Is Rising Again
In a promising sign for future rental supply, buy-to-let lending has increased:
17% rise in total loans to property investors year-on-year.
28% increase specifically in loans for new rental home purchases.
Newer, professional landlords—especially those focused on long-term growth—are entering the market, while some older investors exit due to increased regulation. Areas like Yorkshire & The Humber and the North East are offering particularly strong yields, over 7% in many cases.
Final Thought
Though rents remain historically high, the market’s cooling pace and the return of landlord investment suggest more balanced conditions ahead. If these trends continue, tenants could see a more competitive and affordable landscape by 2026.
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