"While demand for renting is at its lowest level for six years, low levels of new investment in private rented housing mean an ongoing scarcity of homes for rent, which is keeping upward pressure on rents"
- Richard Donnell - Zoopla
Rents in Britain's more affordable areas are rising more than twice as fast as the national average, with new data from Zoopla pointing to a widening divide in rental market affordability between lower-cost towns and major cities.
Zoopla's latest Rental Market Report finds that in areas where average rents sit at or below £750 per month, annual rent growth is running at 5%, compared with a national average of 2.1%. Carlisle is among the fastest-rising markets, with rents up 9.1%, followed by Kilmarnock at 9% and Halifax at 6.5%.
Despite those increases, rents in these areas remain well below the national average in absolute terms. In Carlisle, Kilmarnock and Halifax, average rents of around £700 are 45-50% below the UK average, meaning renters face sharper proportional increases with fewer alternatives available to them.
The picture is different in higher-cost urban centres. Birmingham (-1.1%), Nottingham (-1.5%), and Bournemouth (-1.7%) have all seen rents fall, with stretched affordability limiting how much further rents can rise in markets where costs are already high. In most areas where rents exceed £1,250 per month, annual growth is at or below the national average for the same reason.
Nationally, rental inflation has eased from 2.6% a year ago to 2.1%, while average earnings are growing at 4% year-on-year. That marks 18 consecutive months in which wage growth has outpaced rent rises, reflecting a gradual improvement in rental market affordability for many renters, particularly those in more expensive areas.
Competition for available properties has also eased significantly, with enquiries per rental listing falling to 5.6 in May 2026, down from a peak of nearly 16 in 2022.
London is the exception. The capital is the only region where demand for rented homes is rising, with enquiries up 6% year-on-year. Higher mortgage rates have kept would-be first-time buyers renting for longer, and with no increase in the number of homes available to rent, London's rental inflation has edged up to 2.2% from 1.9% a year ago. The average rent in the capital now stands at £2,206 per month.
Across every UK region, the number of homes available to rent remains 20-30% below pre-pandemic levels. The lack of new investment in private rented housing continues to place upward pressure on rents and limit choice for tenants, particularly in lower-cost areas where demand is growing fastest.
"We're seeing a split in how different regions and cities are responding to changes in the supply and demand for rented homes," said Richard Donnell, executive director at Zoopla.
"Our latest report shows just how fast the gap in rents is closing between more affordable regions and major cities where rents are highest. Rent inflation is more subdued across most of the UK's major cities due to already stretched affordability levels for renters.
"While demand for renting is at its lowest level for six years, low levels of new investment in private rented housing mean an ongoing scarcity of homes for rent, which is keeping upward pressure on rents.
"It's positive that earnings continue to grow faster than rents at a national level, but the experience of renters in local areas varies widely and is a challenge for lower-income renters. Growing the supply of rental homes is the single most effective way to improve affordability for private renters, particularly those in traditionally more affordable areas who have the fewest choices and are facing the sharpest increases."
Julie Ford, property expert and founder of Lettings Advice Service, said the market was settling into a more sustainable pattern. "The rental market is settling into a more sustainable rhythm, with enquiries per property easing far below the recent peak in demand. This isn't a sign of falling demand; tenants still need homes, but many are maybe choosing stability under the new Renters Rights Act, reducing churn rather than reducing need."
Her advice to renters was practical. "Act fast but stay realistic. Good properties move quickly, but renters should still take time to understand total monthly costs, including utilities and council tax. It's also important to get your paperwork ready early. Having references, ID and proof of income prepared can help you move quickly in a competitive market and have a holding deposit ready to transfer."
For landlords, she added, regular property reviews and presentations matter. "Reviewing your property regularly is important. Staying aligned with local market trends helps ensure the property lets quickly. It's also important to present the property well to attract higher-quality tenants. Fresh paint, clean spaces and small repairs can significantly reduce void periods."
Zoopla expects rental inflation to remain within a 2-3% range for the rest of 2026, though the report cautions that without a meaningful increase in supply, improvements to rental market affordability will remain fragile, with renters in lower-cost areas continuing to bear the greatest pressure.
Nathan Emerson, CEO of Propertymark, comments, “While it is positive to see rental growth slowing nationally and wage growth beginning to outpace rent increases, these figures demonstrate that affordability pressures have not disappeared. In many areas where rents have traditionally been lower, demand remains strong and limited housing supply is pushing prices upwards at a faster rate than the national average.
“The underlying issue remains a chronic shortage of rental supply. Propertymark’s own member data consistently shows that prospective tenant demand continues to outstrip available stock, and despite some easing in competition, there are still far too few homes available to meet housing need. This is particularly evident in lower-cost locations where renters often have fewer alternatives and less flexibility when prices rise.
“To improve affordability and provide greater choice for renters, we need to see increased investment in the private rented sector, greater confidence among existing landlords to remain in the market, and a sustained increase in the supply of homes available to rent. A healthy and well-supplied rental market benefits everyone by offering greater stability, increased choice and more sustainable rental growth over the long term.”
“While rental growth has slowed nationally, the market's core problem remains unchanged, there simply aren't enough homes available to rent," comments Marc von Grundherr, Director of Benham and Reeves.
"That's why we're now seeing some of the strongest rental growth in areas that were traditionally considered more affordable, as tenants compete for a limited pool of stock.
"London continues to be an exception. Demand is still rising, higher mortgage costs are keeping many would-be buyers in the rental sector for longer, and that continued pressure is helping to push rents higher despite already elevated rental values.”
Roma Sharma, Managing Director of Rushbrook & Rathbone, said, “Demand may have eased from the frantic levels seen in recent years, but supply remains far too constrained to deliver any meaningful relief for renters. As a result, rents continue to climb, particularly in markets where tenants have fewer alternatives.
"For landlords, the focus is increasingly shifting from chasing rental growth to retaining good tenants. In a market where affordability remains stretched, well-maintained homes, proactive management, and minimising void periods are becoming more important than ever.”
"Zoopla's latest figures are a reminder that while rental demand remains resilient, the days of letting agents being able to rely on market momentum alone are fading, " noted Sim Sekhon, Group CEO at Propoly.
"With rental stock still well below pre-pandemic levels and demand becoming more balanced, agents are operating in an environment where every landlord instruction is increasingly valuable. The focus is shifting from simply managing volume to delivering efficiency, speed and service quality.
"As the market becomes more nuanced across different regions, success will increasingly depend on operational efficiency and the intelligence layer sitting around the tenancy lifecycle. Compliance, workflow automation, and risk intelligence are helping agents reduce friction, improve decision making and deliver a more consistent experience for landlords and tenants.”
Sam Reynolds, CEO of Zero Deposit, commented, "While national rental inflation is beginning to ease, new data from Zoopla suggests affordability pressures are far from over for renters. Rent growth continues in many traditionally more affordable areas, while a shortage of available homes is keeping competition for properties high.
"For many renters, it's not just the monthly rent that's the challenge. The upfront cost of moving remains a significant hurdle. Even with reforms to rent-in-advance practices, deposits, initial rent payments and moving costs can still amount to thousands of pounds at the start of a tenancy.
"At a time when renters are being asked to stretch their budgets further, the industry must continue looking at ways to remove unnecessary barriers to tenancy. Deposit alternatives can free up valuable cash at the start of a tenancy, while rent guarantor products that remove the need for a personal guarantor can open up access to housing for people who may otherwise struggle to secure a home, particularly students, international renters and those without family support.
"With rental supply still 20-30% below pre-pandemic levels across the UK, the balance between improving access for tenants and maintaining confidence for landlords remains a central issue as the market continues to evolve.”
