Rents across Great Britain fell by 0.4% year-on-year in August 2025, bringing the average monthly rent down to £1,387.
While the decline is modest, it marks the joint second-largest annual fall in rents since the index began in 2011, and the largest since the post-Covid dip in 2020, says property group Hamptons.
This drop also represents the ninth consecutive month where rental growth has lagged behind inflation. With the Consumer Price Index rising by 3.8% in July, tenants are finally seeing a rare moment of respite. For much of the last five years, rapidly rising rents had been a key contributor to the UK’s inflation story.
Not just a blip
While the recent dip in rents is notable, it comes after a prolonged period of rapid growth. Over the past five years, rents have risen by 31%, outpacing CPI inflation, which grew by 24.9% over the same period. Stretch that comparison to a decade, and the gap widens even further – rents are up 41%, while CPI has increased by 34%.
This disparity has real financial consequences, Hampton said.
Had rents simply tracked inflation over the last five years, the average tenant would now be paying £1,308 per month—saving £952 annually. Over a ten-year horizon, the savings would be even greater, with tenants paying £1,611 less each year than they currently do.
To put this in perspective, if rents had followed the same trajectory as air fares, tenants would now be paying £1,934 per month. That’s nearly £550 pcm more than today’s average.
On the other hand, if rents had tracked the price of cameras—one of the few items to fall in price—monthly costs would be just £973, a level last seen in April 2017.
London leads the decline
The national picture masks significant regional variation, Hamptons said. In August, rents fell in four of the eleven regions across Great Britain, with London leading the decline.
Greater London saw rents drop by 3.3% year-on-year, while Inner London experienced a sharper fall of 5.8%. In fact, rents in Inner London are now £179 per month below their October 2024 peak and 1.3% lower than they were two years ago.
This marks the eighth consecutive month of annual rental declines in London, suggesting a sustained shift in landlords’ pricing power. The North East and Yorkshire & Humber also saw annual declines, albeit more modest at 0.2% and 0.5% respectively. These are the first drops in these regions since early 2020.
Elsewhere, rental growth remains in positive territory, though the pace is slowing. The Midlands, South West, and Scotland all posted increases, with the West Midlands leading the way at 2.5% for new lets and 6.8% for renewals.
These figures suggest that while some regions are cooling, others continue to see upward pressure – particularly where supply remains tight, Hamptons said.
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