Figures from Foxtons show a 25% uplift in new renter applications month-on-month, meaning demand remains higher than July last year, and average rents rose 1% to £596 a week - just shy of the market peak in 2023.
Foxtons say the data indicates a 'healthy, stabilising London rental market' with robust renter activity, a surge in new instructions, and steady rental growth.
Regionally, Central London continues to lead in absolute volume and growth on new renter registrations, recording a 4% increase year-on-year. In contrast, the South and West regions saw declines of 15% and 22% respectively.
The number of new renters per new instruction rose 21% month-on-month, reaching 18.5 renters per available property in July - indicating market competitiveness in the busy summer months. When viewed year-to-date, competitiveness has eased slightly with a 2.9% year-on-year reduction, but this is a significantly smaller deficit than recent months. Central and North London were the only regions to see an increase in competitiveness compared to last year, while the East and Surrey regions experienced the most pronounced declines.
Renter budgets continue to increase gradually, with the average applicant budget reaching £554 per week year-to-date - 2% higher than the same period in 2024, and the highest level in four years. Foxtons call the pace of growth 'measured', with affordability limits and wider economic conditions tempering growth. In July, tenants spent an average of 99% of their stated rental budget, in line with year-to-date averages. Central London remains the only region where renters consistently spend above their registered budget. Across the network, 29% of renters are exceeding their budget to secure property, while 63% transact below budget, indicating improved choice and reduced urgency due to stronger supply.
Gareth Atkins, managing director of lettings, said: “The London lettings market remained red hot in July. Despite a modest uptick in supply, applicant demand surged by 25% month-on-month, resulting in over 18 applicants per available property. This sustained pressure has driven rental prices upward in line with seasonal trends, and we expect this momentum to continue for the rest of the summer.”
