Private rental costs in the UK surged 7.0% in the year to May, defying a sharp slowdown in house price growth and mounting regulatory pressures. The average rent now stands at £1,339 per month, according to new data released by the Office for National Statistics (ONS).
This rise in rental costs comes as house prices registered a modest annual increase of just 3.5% to April, cooling significantly after a brief spike driven by changes to Stamp Duty Land Tax (SDLT). The policy shift, which came into effect on April 1 and raised the threshold for non–first-time buyers, led to a flurry of property transactions in March, followed by a slowdown in April.
Landlords Hold Firm Amid Market Shifts
Despite ongoing political uncertainty and tightening regulations, landlords across the country remain resilient, buoyed by strong tenant demand. Nathan Emerson, CEO of industry body Propertymark, cautioned that a number of landlords are weighing their options.
“There has been much discussion and immense concern for many landlords,” said Emerson. “A considerable number are contemplating selling their properties, which risks reducing supply even further.”
Regional Disparities Deepen
The North East led the country in rental growth, recording a 9.7% year-on-year increase—the highest since records began in 2015. Wales (8.5%), Northern Ireland (7.7%) and London (7.7%) also posted significant gains.
London remains the UK’s most expensive rental market, with average monthly rents reaching £2,249. In contrast, tenants in the North East pay an average of just £733. Detached properties command the highest average rents at £1,529, while one-bedroom flats remain the most affordable at £1,086.
Stamp Duty Shake-Up Alters Market Dynamics
The SDLT revisions introduced in April have had an immediate impact on the housing market. The new rules raised taxes on purchases above £125,000 for non–first-time buyers, prompting a rush to complete sales before the deadline. The effect, said Emerson, was dramatic.
“The Stamp Duty threshold changes completely altered consumer habits,” he noted. “The housing market saw a marked increase in mortgage approvals and transactions in March, followed by a clear dip in April.”
According to the ONS, the average UK house price in April stood at £265,000. Regionally, England reported prices at £286,000 (up 3.0%), Wales at £210,000 (up 5.3%), Scotland at £191,000 (up 5.8%), and Northern Ireland at £185,000—marking a 9.5% annual rise for the first quarter.
Policy Reform Poses Further Challenge
Meanwhile, looming legislative reforms continue to unsettle landlords. In Scotland, the Housing Bill is still under parliamentary review, while in England, the long-debated Renters’ Rights Bill edges closer to enactment.
The ONS has opened consultations on its Price Index of Private Rents (PIPR), giving landlords a rare chance to help shape future rent tracking methodologies. With inflation receding but housing demand holding firm, many in the sector argue the time is ripe to bolster incentives for landlord investment.