Rents rise by less than earnings as demand from tenants drops
Demand for rented properties is falling, with the number of tenant enquiries at its lowest level for six years.
Zoopla says there were just 5.6 enquiries per rental property listing in May 2026, down from a peak of almost 16 in 2022.
The fall in demand means that average rental prices have increased by less than average earnings over the past 12 months.
While the average income is up 4.1 per cent year-on-year, the average rent on newly let properties has risen by 2.1 per cent.
Falling demand has not reduced rents, according to Zoopla, because the number of homes available to rent remains 20 to 30 per cent below pre-pandemic levels.
The property website also said investment in new private rented homes remains low.
Tough task: There were just 5.6 enquiries per rental property listing in May 2026, says Zoopla, down from a peak of almost 16 in 2022
Tenants in cheaper areas more likely to see rent rises
Zoopla found that renters in areas with lower average rents are facing the fastest growth in prices.
In areas with average rents below £750 a month, rents are up by nearly 5 per cent, more than double the national average.
Conversely, the property portal says that in more expensive areas the high cost is limiting how much rents can increase.
Newly agreed rents in Carlisle are up 9.1 per cent year-on-year to £739, it said, compared to just 2.4 per cent in Manchester where the typical rental lets for £1,186.
In Telford in the West Midlands, average rents are up 6.3 per cent to £909 per month – but in nearby Birmingham they have fallen by 1.1 per cent to £1,035.
Other towns to see rents surge include Kilmarnock in Scotland, where rents are up 9 per cent and Halifax in Yorkshire and the Humber, up 6.5 per cent.
There are a few towns and cities where rents have fallen.
In Nottingham new rentals are 0.9 per cent lower than they were a year ago, and in Bournemouth they are down 1.7 per cent.
On a regional basis, annual rental growth varies from just 0.4 per cent in the West Midlands to 3.8 per cent in the North East.
Zoopla says there has been an uptick in enquiries for rented homes in London, despite no change in the number of homes for rent.
This perhaps explains why rents in London have increased to 2.2 per cent, up from 1.9 per cent a year ago.
| Location | z | z |
|---|---|---|
| Aberdeen | 0.80% | £731 |
| Torquay | 0.80% | £973 |
| Slough | 0.80% | £1,603 |
| Northampton | 0.60% | £996 |
| Reading | 0.60% | £1,339 |
| Cambridge | 0.40% | £1,423 |
| Brighton | 0.30% | £1,461 |
| Ilford | 0.20% | £1,772 |
| Swansea | 0.00% | £847 |
| Medway | -0.50% | £1,244 |
| Nottingham | -0.90% | £927 |
| Coventry | -1.00% | £1,040 |
| Birmingham | -1.10% | £1,035 |
| Peterborough | -1.50% | £932 |
| Bournemouth | -1.70% | £1,235 |
| Source: Zoopla |
Greg Tsuman, managing director of lettings at Martyn Gerrard Estate Agents says the drop off in rental enquiries will come as a surprise given the upheaval caused by the Renters’ Rights Act.
However, despite this, he says there is clearly still a massive shortage of rental properties across the country.
‘The figures show a 20–30 per cent drop in homes available to rent since before the pandemic, which is a significant decline. This comes as the UK population grew by more than 2 million people over the same period.
‘London continues to see the greatest affordability imbalance and ,the highest rents, because there is no new investment taking place. Rents could, and should, be falling.
‘While the figures show that the ratio of tenants to homes has fallen nationally, we’re seeing the opposite in north London. We’ve seen a 53 per cent increase, with 23 tenants per property in June, up from 15 in April last year.’
