The average price of renting a private home in the UK capital increased 9.7% in the 12 months to June, the ONS said on Wednesday
London rental inflation dropped to single figures for the first time in five months, though tenants still paid a record of nearly £2,100 in June.
The average price of renting a private home in the UK capital increased 9.7% in the 12 months to June, the ONS said on Wednesday. London rents were up 0.6% month-on-month, the smallest rise since November.
The decline brings some relief for tenants pressured by both soaring rents and a cost-of-living crisis in recent years. However, they are still facing painfully high costs as shortages of places to rent collide with strong demand from people priced out of the owner-occupier housing market.
London saw the fastest annual rise in England and the average private rent reached £2,098 per month, nearly £350 higher than two years ago.
Monthly rental payments are still increasing much faster than wages across the country. In England as a whole, they advanced 8.6% in the year to June to £1,310 on average.
The rental sector urgently needs investment to keep pace with demand, according to Nathan Emerson, chief executive of Propertymark.
There has been much insecurity across the rental market over recent years due to aspects like uncertainty surrounding the Renters’ Reform bill, increases in taxes, and a lack of clarity regarding regulation, he added.
Zoopla’s latest report on the rental sector showed that a mismatch between supply and demand is beginning to narrow. However, it cautioned that it “remains well out of kilter.”
Separate data from the Land Registry showed that average house prices were up 1.2% month on month to £285,201 in May.
It was stronger than the industry’s house price indicators, which have shown continued elevated mortgage rates and affordability constraints hampering the property market recovery this year. The official measure, which includes cash buyers, lags indicators based on mortgage approvals as it tracks prices at the end of housebuying process.
Nationwide Building Society’s measure had prices increasing 0.4% in May and 0.2% in June.