The UK may be past peak rental growth, but rents are still rising as they were a year ago despite a reduction in the high demand for rental property. Rental inflation is showing signs of slowing down when major cities and towns are reviewed.
Looking around the UK, the only place that has rental growth still in double digits is Scotland at 11.6% with London the lowest at 5.1%. The continued rise in rents now means that rents are 30% of gross earnings as measured at the end of 2023. High demand for rental property is a key factor behind the rise in rents. There are various reasons behind this; for example, raised mortgage rates have helped to increase demand for rental property from would-be first time buyers, which has placed upward pressure on rents and hence also adversely affected affordability.