The average advertised rent outside London has climbed to a record £1,349 per calendar month, despite signs that the rental market is beginning to ease after years of intense competition.

According to the latest data from Rightmove, the quarterly increase of 0.6% is the smallest at this time of year since 2020, suggesting some pressure is finally being released from tenants. In London, rents also rose – albeit by just £3 – to a new average of £2,698 per month, marking the capital’s 14th consecutive quarterly record.

The rise in rents comes despite a notable boost in supply. The number of new properties entering the rental market in March was 11% higher than a year ago, while total available stock is up 18% compared to 2024.

At the same time, tenant demand has softened slightly, with enquiries down 7% on the year.

First-time buyer activity is partly behind the cooling rental demand. Zoopla figures show that sales agreed in the first-time buyer sector were 7% higher in the first quarter of 2025 compared with the same period a year ago, supported by slightly lower mortgage rates and a rush to beat changes to stamp duty that came into force in April.

CONDITIONS REMAIN TIGHT

Compared with pre-pandemic levels, there are still 10% more prospective tenants and 33% fewer rental homes available, highlighting the deep imbalance that persists.

A typical rental property is now receiving 12 enquiries, down from 16 a year ago, but more than double the pre-pandemic average of five.

REGIONAL VARIATIONS

A rental listing in London currently attracts an average of eight enquiries, compared with 18 in the North West, reflecting where supply shortages are most acute.

More supply and softening demand have led to a rise in price reductions. Around 25% of rental properties are now seeing their advertised rents cut – the highest proportion at this time of year since 2018.

Analysts say this indicates stretched affordability after five years in which average rents have risen by 40%, outpacing the 31% growth in average earnings.

REGULATORY IMPACT

The upcoming Renters’ Rights Bill, which includes measures such as restrictions on asking tenants for rent in advance, has so far had little impact on rental market activity. However, experts warn that the changes could have wider effects on tenant choice and landlord requirements over time.

Colleen Babcock, property expert at Rightmove, said: “The market is still busy, but the balance between supply and demand is improving. This is starting to slow rent increases and prompt more landlords to reduce advertised prices.”

And Christian Balshen, lettings expert at Rightmove, added: “Landlords will remain focused on securing reliable, long-term tenants, especially as new legislation reshapes parts of the sector.”

In London, Marc von Grundherr, director at Benham & Reeves, said international tenants and the return to office working continued to drive demand.

He added: “Rental values have climbed, and recent increases in buy-to-let mortgage lending suggest ongoing investor confidence, despite looming regulatory changes.”