South-east London postcodes dominate the list of highest rent risers, led by sharp year-on-year increases in Crystal Palace and Forest Hill, where rents have jumped 11.1%.
The average room rent in inner London is now £979 per month, a marginal rise of 0.3% on the previous year. In outer London, rent stands at £794 per month, down 0.6% year-on-year. Over the past five years, inner London rents have risen 37%, while outer London rents are up 34%.
Flatshare supply is falling in inner London, down 5% year-on-year, but holding steady in outer London, up 0.9%. SpareRoom's improved rental index launches today with an updated methodology, and historical data has been recalculated for consistency.
- Crystal Palace and Forest Hill: +11.1% year-on-year
- West Norwood: +8.6% year-on-year
- Herne Hill: +7.5% year-on-year
Flatshare supply dropped by 5% in inner London during the second quarter of 2026, the same period in which phase one of the Renters' Rights Act came into effect. Despite this, inner London rents have held steady at £979 per month, only a small increase of 0.3% on Q2 2025, according to rental index data from flatshare site SpareRoom.
In outer London, rents fell slightly by 0.6% in the year to Q2 2026, as supply rose marginally by 0.9%. Renting an average room in outer London now costs £794 per month.
There are notable outliers, however. Eight south-east London postcodes dominate the list of the 10 highest risers for rent in Q2. Sharp year-on-year increases in Crystal Palace and Forest Hill have taken the average rent in both postcodes above £900 per month, while pricier West Norwood and Herne Hill have seen increases of 8.6% and 7.5% respectively.
East and north London remain the most affordable areas in the capital, with average rents of £933 and £937 per month respectively. Renters seeking affordability could also look at Muswell Hill in north London, where rents average £884 per month, or Norwood in south-east London at £804 per month; both have seen the highest year-on-year falls, down 11.4% and 7.2% respectively, and sit below the inner London average. Eight inner London postcodes now have sub-£800-per-month rents, including Penge at £796 and Winchmore Hill at £797.
Why London rents are rising fastest in the south-east
"Crystal Palace and Forest Hill were once seen as 'good value alternatives' to places like Clapham or East Dulwich," said Matt Hutchinson, director at flatshare site SpareRoom.
"Today, they're highly desirable in their own right, with plenty of green space, the Windrush line and rail connections, bags of character, and rents below the inner London average.
"In the knowledge that sky-high housing and living costs might mean they're sharing for years to come, flatsharers today are increasingly concerned about quality of life as well as affordability, and they're moving wherever can offer them the best of both, pushing up rents in the process."
