Advertised rents have reached new highs both inside and outside London. But while Rightmove’s latest figures suggest a more balanced national market, other evidence points to renewed competition for rental homes. London is experiencing a particularly sharp squeeze, with fewer properties available and more interest from prospective tenants.
Imagine two people beginning their search for a rented home. One is looking for a flat in London, the other for somewhere similar in a Midlands city. Neither is likely to find the prices they might have paid a few years ago. But the competition they face, the choice available and the speed at which they need to make decisions may now be quite different.
That divergence is the more important story in Rightmove’s Q3 2026 Rental Price Tracker. The headline figures are records: the average advertised rent outside London has passed £1,400 a month for the first time, reaching £1,418. In London, the average asking rent has climbed to £2,825. Yet those figures conceal a rental market becoming increasingly uneven, with the capital showing renewed pressure while conditions elsewhere vary considerably.
| Rightmove, Q3 2026 | Outside London | London |
|---|---|---|
| Average advertised monthly rent | £1,418 | £2,825 |
| Annual growth in advertised rents | 2.4% | 3.2% |
The contrast becomes clearer in the activity figures. Across Great Britain, Rightmove reports that the number of available rental homes and its measure of renter demand are both approximately 2% lower than a year ago. In London, available listings have fallen 9% while measured demand has risen 6%. The national figures do not establish that every market outside London is experiencing the same conditions, but they reveal a considerable difference between the capital and the overall picture.
For tenants, the distinction matters because slower rental inflation does not necessarily make a home affordable. For landlords and investors, record advertised rents are not always translating into stronger returns. And for letting agents, a market with fewer available homes can be commercially challenging even when the rents being advertised are higher.
Higher rents, but how much is the market really cooling?
Outside London, advertised rents increased 1.5% during the quarter and 2.4% over the year. That is a substantial slowdown from the double-digit annual increases recorded during parts of 2021 to 2023, when competition for rental properties intensified dramatically.
Rightmove describes a national market that is more balanced than during that period. Available rental homes remain constrained, but its measure of renter demand has also eased. The figures suggest less of the extraordinary imbalance that previously allowed asking rents to accelerate so quickly, although annual changes in supply and demand do not, by themselves, establish how much competition individual tenants face.
Other research offers a more cautious interpretation. Zoopla’s September 2026 Rental Market Report found that the number of homes available to rent was 3% below a year earlier, with the flow of new properties onto the market down 6%. It recorded an average of 5.3 enquiries per rental listing, 6% higher than the previous year and the highest level for almost two years. Rather than a market steadily settling into balance, Zoopla’s analysis suggests that competition for available homes has started increasing again.
The two reports use different property data, reference periods and measures of tenant activity. Zoopla’s enquiries per listing are not equivalent to Rightmove’s annual change in measured renter demand, and their figures cannot be combined into a single statistical series. Both identify limited rental supply and particularly strong pressure in London, but they offer different assessments of the wider market’s direction.
That difference is revealing. A national slowdown in advertised rent increases does not necessarily mean competition is easing everywhere. In Yorkshire and the Humber, Zoopla reported 12% fewer homes available to rent than a year earlier, while Wales recorded a 7% increase in availability. Those markets cannot sensibly be described as experiencing identical conditions simply because they sit outside London.
For renters, the distinction between slower growth and lower rents is substantial. An average asking rent of £1,418 following annual growth of 2.4% implies a comparable market average of approximately £1,385 a year earlier. That represents an increase of around £33 a month, or almost £400 over a full year. These are changes in the published averages, not evidence that the rent for the same individual property increased by precisely that amount.
Even so, the direction is clear. Annual increases have moderated considerably from the fastest-growing years, but those increases follow a period that has already lifted asking rents substantially. Someone who struggled to afford a rental property two years ago may find little comfort in learning that its price is now rising more slowly.
Nor are percentage increases uniform across the country. The Office for National Statistics’ September 2026 private rent bulletin shows that rents in the North East and North West of England increased by 5.8% in the year to August, compared with 3.0% in the South East.
The ONS measures rents across new and existing tenancies rather than Rightmove’s advertised asking prices, so the figures are not directly interchangeable. They nevertheless highlight an important affordability problem: tenants in lower-priced areas can face some of the strongest percentage increases. Cheaper rent does not necessarily mean comfortable affordability where local earnings are also lower.
The market may therefore be moving away from the exceptional conditions of the early 2020s without returning to anything resembling easy access to affordable rental housing. National averages are useful for identifying the broad direction, but increasingly inadequate for describing what prospective tenants encounter locally.
London’s rental squeeze is becoming more pronounced
London provides the clearest example of demand rising against falling rental availability. Average advertised rents increased 3.2% annually to £2,825 a month, faster than the 2.4% outside-London average. The capital ranks third among Rightmove’s regions for annual rental growth, reflecting the fact that some lower-cost parts of Britain continue to record faster percentage increases.
What distinguishes London is the combination of shrinking availability and increasing measured demand. Total rental listings are down 9% compared with a year earlier, while newly advertised properties have fallen 7%. Over the same period, Rightmove’s renter-demand measure has increased by 6%.
These figures describe activity on the property portal rather than every household seeking accommodation, but they provide evidence of renewed pressure. Zoopla’s separate research points in the same broad direction, reporting that London’s rental availability has fallen while demand has strengthened, with particularly tight conditions in inner London.
The reasons are more complicated than the figures alone can establish. London continues to concentrate employment, education and other opportunities that attract renters, while the cost of purchasing property can keep households in the private rented sector for longer than they originally intended.
Higher mortgage rates add to that difficulty. Buying an expensive London property often requires both a substantial deposit and a larger mortgage than would be needed elsewhere. Zoopla estimates that an average London buyer would need an additional £35,500 in deposit funding to keep mortgage repayments unchanged following the rise in borrowing rates during 2026, compared with £18,200 for the average UK buyer.
That is an indication of how changing borrowing conditions can affect the ability to leave the rental market. It does not establish that the same number of potential buyers have delayed purchasing, but it supports the possibility that weaker access to homeownership is sustaining rental demand.
The supply response is equally important. High rents might appear to make London an attractive place for landlords to invest, yet expensive property purchases and higher financing costs can leave new investments offering less attractive returns than the monthly rent suggests. Strong tenant demand is therefore not necessarily enough to encourage a rapid increase in privately rented homes.
For people searching in London, the consequences can be immediate. Fewer available properties may mean less choice, shorter decision-making periods and pressure to compromise on location, size or condition. Some households may remain in existing tenancies longer, particularly where moving would expose them to a substantially higher asking rent. Others may search farther from employment centres, adding time and expense to everyday life.
The price difference compounds the pressure. London’s average advertised monthly rent is almost twice the figure outside the capital. Annual growth of 3.2% implies a comparable previous-year average of approximately £2,737, an increase of about £88 a month. Outside London, the equivalent change in the average is around £33.
A region does not need the highest percentage rent growth to experience the greatest additional cost in pounds. The starting rent matters just as much, particularly for households whose incomes have little room to absorb further increases.
This has consequences beyond individual housing budgets. The cost and availability of rental accommodation can influence whether workers are able to move for employment, whether younger households can live independently and whether families can remain near schools and established support networks. Those effects are not directly measured by the tracker, but a prolonged imbalance between demand and available homes makes them increasingly relevant to the capital’s wider economy.
Advertised rents tell only part of the affordability story
Rightmove measures asking rents for properties being marketed to prospective tenants. These figures are particularly relevant to people searching for somewhere new, but they are not the average amounts paid across all existing tenancies.
The ONS measures a broader market. Its September bulletin, published using rental data through August 2026, put the average UK private rent at £1,400 a month, up 3.8% over the year. London’s average was £2,332, with annual growth of 3.5%.
There is no contradiction in the fact that Rightmove reports a higher London figure. The two organisations measure different groups of properties, using different methodologies and reference periods. The ONS includes rents under existing tenancies, whereas Rightmove concentrates on homes being advertised to new tenants. Rightmove’s outside-London figure also cannot be compared directly with the ONS’s UK-wide average.
Both sources show that rental costs remain elevated. Their different measures explain why a slowdown in newly advertised rents does not necessarily translate immediately into lower housing costs for people already renting.
Affordability also depends on what households earn. The ONS earnings figures published in September recorded annual growth of 3.5% in average regular earnings across Great Britain during May to July 2026. That provides context for rental pressures, but it does not establish whether individual tenants’ wages have risen sufficiently to offset housing costs. The incomes of renters, especially those on lower or insecure earnings, may differ substantially from the national employee average.
In England, rental legislation has also changed. The first phase of the Renters’ Rights Act took effect on 1 May 2026, including restrictions on rent increases during existing tenancies and rules preventing landlords or agents from inviting, encouraging or accepting offers above the advertised asking rent. PFP explains the wider changes in Renting in England Changed in 2026: What the Renters’ Rights Act Means for Tenants.
One possible consequence is that advertised rents may increasingly reflect the maximum amount a landlord seeks when initially marketing a property, rather than a starting figure from which competitive bidding could push the agreed rent higher. The latest rental-market data does not establish whether that behaviour is occurring or how much it may influence asking prices.
It would therefore be premature to attribute London’s renewed pressure to the legislation, particularly when other evidence points to affordability constraints, borrowing costs and changes in the supply of available homes. The rental reforms apply to England; Scotland and Wales have separate legal frameworks.
Record rents do not necessarily mean stronger landlord returns
The financial position of landlords adds another dimension to the market’s uneven behaviour. Asking rents are at record levels, yet some property owners face higher costs that can absorb much of the additional rental income.
Rightmove reports an average two-year fixed buy-to-let mortgage rate of approximately 5.34%, compared with 4.16% at its reference point before the conflict in Iran began. That is an increase of 1.18 percentage points, with potentially substantial implications for landlords whose existing fixed-rate deals are ending.
Consider an illustrative £200,000 interest-only buy-to-let mortgage. At 4.16%, monthly interest would be approximately £693. At 5.34%, it would be £890, a rise of around £197 a month, or £2,360 over a year. The example isolates the effect of interest rates on a fixed loan balance; it does not represent a particular landlord’s refinancing offer or include product fees.
That additional expense could absorb a considerable share of the rent increases experienced by an individual property. Insurance, maintenance, management, compliance and periods without a paying tenant further affect the amount the owner retains.
Landlords’ circumstances differ widely. Some have no borrowing, while others hold older properties with substantial equity or mortgages fixed at different rates. Higher advertised rents may improve the position of some investors while leaving others with thinner margins, particularly when refinancing brings a sharp increase in financing costs.
The distinction between rental income and actual profitability is examined in more detail in PFP’s How Much Profit Does a Buy-to-Let Really Make?. For the present market, the significance is that higher rents alone do not show whether additional rental investment has become more attractive.
London makes that particularly apparent. Demand is strengthening, and available homes are becoming scarcer, but high acquisition costs can suppress the yield available on a new purchase. Elsewhere, lower property prices may allow investors to achieve higher gross yields even where advertised rents are rising more slowly.
That creates a problem for future supply. The places where demand is strongest are not necessarily the places where the economics of purchasing and operating additional rental property are most compelling. If investors cannot justify new acquisitions at prevailing prices and borrowing costs, higher rents may not produce a sufficiently strong supply response.
Are landlords leaving — or is new investment becoming less attractive?
Rightmove’s report offers two indicators of possible changes in landlord behaviour, although neither provides a definitive measure of the number of properties entering or leaving the rented sector.
Approximately 13% of homes advertised for sale had previously been advertised to rent, compared with 12% a year earlier. At the same time, the proportion of homes listed to rent that had previously appeared on the sales market fell from 17% to 15%.
The first measure suggests continued interest among some landlords in selling. But a former rental property appearing for sale does not establish that it has sold or permanently left the rented sector. Some properties will not find buyers, while others may be bought by investors who continue letting them.
The second measure is consistent with reduced activity involving properties moving from sale listings into the rental market. It may reflect greater caution among potential investors, but it is not a direct count of completed buy-to-let purchases.
Neither change supports a claim that landlords are abandoning the market en masse. The movement from 12% to 13% is relatively modest, and the underlying measures concern property advertisements rather than the total number of landlords or privately rented homes.
The more important distinction is between the stock of homes rented privately and the number available to people searching for a new tenancy.
An existing landlord may retain a property for many years while the same tenant remains in occupation. That home continues to form part of the private rented sector but does not appear among current rental listings. A reduction in advertised availability can therefore occur without an equivalent reduction in the total number of rented homes.
Sales create further complexity. A landlord selling to another investor may leave rental supply unchanged. A sale to an owner-occupier may remove a property from the rented sector, but if the buyer was previously a tenant, their departure can also reduce rental demand. What matters is the net effect of these different movements, not simply the number of former rental properties advertised for sale.
For letting agents, reduced new-let activity can have commercial consequences even when average advertised rents are rising. Fewer instructions may mean fewer opportunities to arrange tenancies, while competition to attract and retain landlords can become more important. Established management portfolios provide a separate source of income, so the effect will differ between agencies depending on their business mix.
Build-to-rent developers and institutional investors may add supply in selected markets, particularly larger cities, but their projects require land, finance, planning and construction time. They cannot respond immediately to a shortage of available rental homes, and the accommodation delivered may not match every household’s budget or needs.
The question for the coming months is therefore wider than whether landlords are selling. It is whether enough homes continue to become available for new tenants, and whether financial conditions encourage owners and developers to increase the supply of accommodation where demand is strongest.
Rightmove’s latest figures suggest rental competition has become more measured across its national sample, even while London faces a renewed squeeze. Zoopla’s September research provides an important caution: rental availability has also been falling across its market measures, with enquiries per listing increasing. Both sources point towards the continuing sensitivity of rents to comparatively small changes in available housing.
The records are real, but they do not describe a single, uniform market. Tenants face different pressures depending on where they search, while landlords and investors face different economics depending on property prices, financing and local demand.
For London, the immediate problem is a smaller pool of available homes meeting stronger interest from renters. Elsewhere, slower average asking-rent growth coexists with local markets where competition and rents remain under considerable pressure.
That is why Britain’s rental market cannot be judged from a record national figure alone. The stronger test will be whether available rental supply begins to recover, whether competition eases beyond the averages and whether the financial incentives exist to provide more homes where they are needed.
Until then, slower rent growth may offer some relief from the pace of increases, but it is not the same thing as a rental market that has become affordable.
This article provides general property market information and analysis as at 19 October 2026, not financial or investment advice. Rightmove’s advertised asking rents differ from rents paid under existing tenancies, and the activity measures reported by property portals are not a complete census of renters or landlords. Rental legislation differs across the UK. Tenants and landlords should consult the rules relevant to their jurisdiction and seek appropriate professional advice before making financial or tenancy decisions.
