"While there are signs that landlords are buying homes again, we do not expect a big increase in supply, meaning rents are set to increase by 2.5% over 2026"
- Richard Donnell - Zoopla
Demand for rented homes has fallen by a fifth over the last year and is the lowest for six years, according to the latest Rental Market Report from Zoopla.
There are 15% more homes for rent than last year, boosting choice for renters. UK rents are just 2.2% higher over the last 12 months, down from 3.3% a year ago. The time to rent a property has increased to 17 days, the highest since 2019.
Rents are rising faster in more affordable areas, including Carlisle at 8.1%, Chester at 7.4% and Motherwell at 7%, where there is headroom for growth. Zoopla expects rents for new lets to rise by 2.5% over 2026.
The report reveals that the imbalance between supply and demand for rented homes has narrowed sharply over 2025. Rental growth has slowed to 2.2% at the end of October 2025, down from 3.3% a year earlier. Average UK rents stand at £1,320 per month, £30 up on last year.
Demand for rented homes is down by 20% over the last year. The drop in demand reflects two main factors: a sharp decline in net migration, which ONS provisional estimates say has fallen by 78% between June 2023 and June 2025, and improved mortgage affordability for first-time buyers, which has boosted demand to buy homes.
The market is on track for 20% more first-time buyers purchasing homes over 2025, and many of these buyers come from the rental market, which releases more homes for rent. This is one reason why there are 15% more homes to rent compared to a year ago. The average estate agency branch now has 14 homes for rent. This is up from a low of just 8 in 2022, though still lower than the pre-pandemic average of 17.
Chart 1: Demand for rented homes falls
The time it takes for a property to rent is a key barometer of rental market health and indicates how supply and demand are shifting in real time. The time to rent has been increasing, with the average home staying on the market for 17 days before being rented. This is almost a fifth higher (18%) than a year ago and 42% longer than during the demand boom for rented homes during the pandemic.
The time to rent has increased across all regions and countries of the UK as the pressure on the rental market has cooled, with the average ranging from 14 days in Scotland to 19 in the West Midlands. Longer times to let will limit how much rents can be increased, which means lower levels of rental growth over 2026.
Chart 2: Time to rent (days), UK - November average each year
Rental inflation across the regions and countries of Great Britain has slowed over the last year. Overall, rental growth is strongest in lower-value markets where affordability provides more headroom for rental increases, while higher-value areas are seeing slower growth as stretched affordability limits further rent rises.
At a country and region level, rents are rising fastest in the North East at 4.5% and North West at 3.2%, while growth is weakest in London at 1.6% and in the West Midlands and Scotland (both 1.7%).
The changes in supply and demand do not play out equally across the country. Some local markets are registering a decline in rents for new lets, with rents lower than a year ago in the Birmingham (-1.5%) and Dundee (-1%) postal areas. In contrast, rents are rising fastest in Carlisle at 8.1%, Chester at 7.4% and Motherwell at 7%. These differences reflect the affordability of rents relative to local incomes, as well as demand and supply.
"The rental market has made a big stride back towards normality over 2025 after a prolonged period of sky-high demand and a lack of homes for rent," said Richard Donnell, executive director at Zoopla.
"This is welcome relief for renters who can expect to see a greater choice of homes, slower rent increases and a less competitive market. However, the high costs of buying a home remain a barrier to many renters, which will support demand for renting over 2026. While there are signs that landlords are buying homes again, we do not expect a big increase in supply, meaning rents are set to increase by 2.5% over 2026."
"Since the Budget, more aspiring first-time buyers are taking the necessary steps towards homeownership, which is further boosted by the current choice of mortgage deals," said Adam Jennings, head of lettings at Chestertons. "This has somewhat dampened demand for rental properties in some parts of the country and could result in rent levels remaining fairly balanced in 2026."
"That being said, if the sales market improves, some landlords may sell rental properties they had previously held back, potentially reducing rental supply. Combined with the ongoing strong tenant demand, particularly in London, this could cause rents to resume their upward trajectory."
