Rents across Great Britain are rising once again as tenant demand strengthens and property supply remains limited. After a period of falling prices earlier in 2025, the rental market is showing clear signs of recovery, with notable growth in both new lets and tenancy renewals.

Rental growth accelerates

According to Hamptons, the annual rate of rent growth on newly let homes doubled from 0.5% in February to 1% in March 2026. Inner London was a key driver of this increase, with rents climbing 4.1% year-on-year to March, reversing the declines seen earlier in the year. This marks a significant turnaround after rents had been falling at the start of 2025.

Tenant demand surges

Hamptons’ head of research, Aneisha Beveridge, highlighted the rebound in tenant interest: “While rents fell last year, early signs suggest the pace of rental growth is beginning to pick up as tenant demand rebounds and mortgage rates rise.” She also noted that the 24% annual increase in tenants starting their search for a new home in March was the largest since records began.

Renewal rents are also on the rise, with prices increasing by 3.1% annually in March, up from 2.2% the previous month. This suggests landlords are able to secure higher rents not only from new tenants but also from existing ones renewing their agreements.

Demand rises across all regions

Tenant activity has strengthened nationwide, with every region experiencing double-digit growth in demand. The 24% increase in people searching for new homes in March was the highest on record, reflecting a broad-based resurgence in the rental market.

However, supply remains constrained. There were 1% fewer homes available to rent than a year earlier, and the number of properties on the market is down 33% compared with March 2019. This limited availability restricts choice for renters and supports upward pressure on rents.

Rents by region

In the first quarter of 2026, 6% of homes were let above their advertised price, a sharp decline from 56% during the same period in 2021. This shift coincides with new rules introduced in England that, since March, have restricted landlords from accepting offers above the listed rent. Hamptons suggests these changes are influencing how rents are set, though not necessarily the final rent levels achieved.

Average monthly rents for new lets varied significantly across the country. London recorded £2,305 on average, with inner London reaching £2,733. The Midlands saw average rents of £1,046, while the North averaged £955. Wales and Scotland recorded £879 and £1,014 respectively.

What this means for landlords

The rise in tenant demand combined with constrained supply presents a positive environment for landlords seeking to increase rental income. The rebound in rents, particularly in London and other high-demand areas, offers opportunities to improve yields after a period of stagnation and decline.

However, landlords must also navigate the new regulatory landscape restricting offers above advertised rents in England. This may require more strategic pricing and marketing to attract tenants while maximising returns. Additionally, the increased tenant activity suggests a competitive market where well-maintained properties and responsive management will be crucial to securing and retaining tenants.

Source: Based on reporting from Property118

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