Rents begins to drop in major cities
Rents have begun falling in major cities with renters in London, Brighton, Glasgow, Nottingham, and Worthing now paying less according to Zoopla. For Londoners, a third of boroughs have seen rents drop. Throughout the country a rise by just 3-4% is expected in 2024, a big drop compared with increases in recent years in 2022 (11%) and 2023 (8%).
The recent boom for rises for new lets, Zoopla said, is “coming to an end. For the past three years, the price to rent has been rising faster than earnings but now it seems the increase is at its slowest pace since 2021.
This is news that will be welcomed by those under pressure and looking to move and is a “clear sign that we’ve passed peak rental inflation.” Demand for rented homes has also dropped, by 39% over the last year though the market is still “hot.”
Zoopla’s data shows that there are 17 people chasing every home for rent on average. That is double the average seen in the pre-pandemic period between 2017 and 2019. But supply of rental homes available per estate agent has slowly began to rise, increasing by 17% in the last year.
This is because more homes are being bought by corporate landlords as lower mortgage rates make it somewhat easier for those looking to buy their first home. This is freeing up rental properties.
But the general availability of homes for renters is still a major challenge. The average agent still has a third fewer available compared with the average before the pandemic.
London is the nation’s most expensive market for rents. With an average monthly payment of £2,172, almost 70% more than the nationwide average, renters are paying more than double the price of many areas. Zoopla’s index shows rents have fallen in more than a third of boroughs in the first half of 2024. These have been concentrated in inner east London, with Tower Hamlets, Newham and Greenwich leading. And rental inflation has now slowed across all areas of the capital.
