The typical advertised rental price outside of London has reached a record high, it has been revealed.

Rightmove data shows average advertised rents outside of the capital rose by 1.9% during the three months from April to June this year, reaching a new record of £1,397 a month.

The figures mean average asking rents outside of London are 2.3% higher than a year ago, up from annual growth of 1.6% in the first three months of the year.

In London, average asking rents rose by 2% in the second quarter to a new record of £2,791 a month, with annual growth accelerating to 2.9%.

It is the largest quarterly increase since 2023, and is driven by inner London rents, according to Rightmove.

While rental growth has picked back up following a flat start to the year, annual increases remain below the double-digit growth recorded during the peak of the rental market competition in 2022 and 2023, the portal says.

Even though supply is no longer increasing, the market remains much more balanced.

Affordability remains a key consideration for renters, with annual wage growth easing to 4.4% and many tenants becoming increasingly price conscious, particularly in higher-priced areas.

Rightmove said this is helping to keep rental growth at more sustainable levels than in recent years, despite rents continuing to edge higher.

Rental market

The rise in rents appears to have been helped by the number of available rental homes dropping below the previous year’s level for the first time since 2022.

In the post-pandemic market, the number of homes to rent reached record low levels and had been steadily increasing since. However, the total number of homes to rent is now 1% lower than a year ago, Rightmove said.

The decline in overall rental supply appears to be driven more by a drop in newly listed properties for rent, rather than an increase in the speed of the market.

Competition between tenants remains significantly lower than at its peak, with the average rental home currently receiving 10 enquiries.

It compares with 11 a year ago and 22 at the height of the market in 2022 – although this is still higher than the pre-pandemic average of five enquiries per home.

Regional variations

There are large regional differentiations.

Northern regions continue to outperform in terms of annual rent growth, with the North East and North West both recording annual rent increases of 4.1%. It compares to 1.5% in East Midlands and East of England.

London currently has the closest balance between supply and demand, with an average of eight enquiries per rental property.

By contrast, the North West is seeing the largest mismatch, with an average of 14 enquiries per property, highlighting continued strong demand relative to the number of homes available to rent.

The report marks the first time data has been analysed following the introduction of the Renters’ Rights Act in May.

Balanced market

Rightmove’s property expert Colleen Babcock says: “We’re seeing new record average rents advertised in both London and Great Britain outside of the capital, however overall, we’re seeing rents return to more familiar seasonal patterns and stable growth.”

“Even though supply is no longer increasing, the market remains much more balanced than it was at the peak of competition in 2022.

“Regional trends also continue to vary significantly across the country, with more affordable northern areas still seeing some of the strongest rental growth. London has seen a notable increase in rents this quarter, and also the largest drop in available rental supply, underlining how local supply and demand dynamics continue to shape rental pricing.”