The rental market remained buoyant in August, despite a slight month-on-month dip in average rents across England, as the supply-demand imbalance began to ease, new figures reveal.
Although there was a marginal month-on-month reduction in the average cost of rent across England, rental prices remain 2.9% higher year-on-year and – at £1,480 per property per month – represent the second-highest rental cost recorded since the Index began in 2019.
At a regional level, August saw new records broken, including the highest ever rental averages for the South East, according to the latest Goodlord Rental Index.
After July’s record-breaking rents of £1,496, August averages dipped slightly – reducing by 1% across England. But August’s rental average of £1,480 remains the second-highest rental average ever recorded by the Index and certain regions saw rents surge even higher than July’s peak.
In the South East, rents rose by an eye-catching 11% – breaking the £1,600 barrier for the first time.
And in Greater London, prices were up by over 5.5% – hitting £2,322. This is the second-highest average ever recorded for Greater London.
The East Midlands also saw a rental surge, with prices up by over 4% compared to July.
It was a different picture elsewhere, with the North East, South West and the West Midlands seeing reductions in the average cost of rent. The biggest reduction was recorded in the North West which, after a huge rental spike in July, saw prices reduce by a dramatic 20% in August.
Overall, rents are now up by 2.9% year-on-year: rising from £1,438 across England on average during August 2024, to £1,480 over the last month. This represents an annual rental increase of £504 for tenants.
However, this 2.9% annual increase continues a trend seen throughout the year: that the pace of rental inflation is softening. In contrast to August’s 2.9% figure, March recorded year-on-year rent rises of 4.6%. This indicates that 2026 could bring a leveling out of rental costs, where monthly prices closely match averages set throughout 2025.
The North West and Greater London saw the biggest year-on-year rental rises, with increases of 6.6% and 5.3% respectively.
Unusually, one region recorded a reduction in year-on-year rental costs – albeit a very small one. The North East saw a decline in average prices: dropping from £1,107 in August 2024 to £1,106 in August 2025.
Meanwhile, average void periods lengthened slightly during August – rising from 12 days in July to 15 days in August. This new average of 15 days is the same as the void lengths recorded in August 2024, highlighting the ongoing supply and demand pressures on the market.
William Reeve, CEO of Goodlord, comments: “It’s been another busy month for the market. Whilst it was unlikely that we would see July’s average rent record broken, the regional picture across Greater London, the South East and the East Midlands shows that we haven’t hit the rental price ceiling just yet. We are expecting another month of high rents in September, before things start cooling off as we move into the autumn.
“The next six months will be pivotal for the market; the pace of rent inflation is going down and there are indications that supply and demand pressures are slightly easing. Combine this with the disruption that the Renters’ Rights Bill will bring, and potential tax changes for landlords in the Budget in the autumn, and we’re in for a very interesting period for the sector.”
Read the orginal article: https://propertyindustryeye.com/rental-growth-eases-as-supply-demand-gap-narrows/
