Rental prices across the UK have slowed significantly, marking the end of years of rapid increases, according to Zoopla’s latest data.
In the year to April 2025, average rents for new tenancies rose just 2.8%, far below last year’s 6.4% growth rate.
This marks the slowest rate of rental growth since July 2021, with the average rent now reaching £1,287 per month.
That figure represents a modest £35 rise from a year earlier, indicating a shift toward greater market stability.
Rental growth has cooled in every UK region, with some areas posting sharp declines compared to previous years.
Yorkshire and the Humber saw the steepest slowdown, with growth falling to 1.1%, down from 6.4% in 2024.
University cities led the region’s decline, with Sheffield growing only 1.9%, Bradford 1.4%, and Leeds falling by -1.5%.
The North East experienced a drop from 9.4% last year to 5.2% now, showing a wider trend across northern markets.
In Scotland, rental growth slowed from 9.1% to 2.4%, with Dundee reversing last year’s gains and falling by -2.1%.
Experts link the Scottish decline to loosening rent controls and growing affordability issues among renters.
London rents have largely stabilised, growing just 1.5%, with average rents reaching £2,175 per month.
Inner London districts posted minor declines, with NW postcodes down -0.2% and WC areas dropping by -0.6%.
Some affordable commuter towns continue to outperform, however, with strong rental growth still seen in selected areas.
Rents in Wigan and Carlisle each rose by 8.8%, while Chester recorded an increase of 8.2% year-on-year.
Still, only five postal areas are now seeing annual growth above 8%, compared to 52 one year ago.
The decline in rental growth reflects falling demand and ongoing affordability challenges more than any major rise in supply.
Zoopla reports rental demand has dropped 16% over the past year, although it remains 60% higher than pre-pandemic levels.
One contributing factor is a 50% decline in long-term net migration during 2024, reducing pressure on the rental market.
More renters are also buying homes, helped by stable mortgage rates and updated affordability rules.
As more first-time buyers exit the rental sector, pressure on rental stock has eased slightly in urban areas.
However, the number of available homes remains tight despite a 17% increase in rental listings since last year.
Current supply is still 20% below pre-2020 levels, with low investment from private and institutional landlords constraining growth.
Zoopla forecasts rents will continue rising moderately, expecting a 3% to 4% increase through the rest of 2025.