UK renters spend nearly a third of income on rising rents
New data from Lomond reveals UK tenants now pay an average £1,369 per month in rent, up 4.3% year-on-year, consuming nearly a third of their income. London commands the highest rents, while demand shifts towards long-term tenancies under new regulations.
Tenants across the UK are facing significant rental cost pressures, with the average monthly rent reaching £1,369 according to recent data from lettings group Lomond. This represents a 4.3% increase compared to the same period last year, signalling ongoing upward pressure on rental prices despite economic uncertainties.
London remains the most expensive rental market by a wide margin, with average rents now standing at £2,418 per calendar month. This figure is 76% higher than the UK average, highlighting the persistent premium for housing in the capital. The data also shows London has the highest volume of new tenancies agreed in the past year, underscoring its continued demand despite affordability challenges.
Renter demographics and regional rental trends
The average UK renter is 31.5 years old, but Scotland stands out with the youngest renter demographic, averaging just 25 years. This is largely attributed to Scotland’s sizeable student population. Regional rental growth is also notable in areas such as Kent, where the number of tenancies has surged by 121%, driven by strong demand for family housing. Kent’s average rents have increased by 5% year-on-year.
Other regions experiencing rent growth include the North West and Yorkshire, with average monthly rents rising by 5% to £1,215 and £1,283 respectively. In the North West, rural and semi-rural towns between Liverpool and Manchester are seeing increased demand. Lomond suggests Manchester’s role as a major economic centre may accelerate, potentially shifting its position from a London alternative to a primary hub in its own right.
Impact of the Renters Rights Act on landlord strategies
Lomond’s chief revenue officer John Ennis highlights that the rental market remains resilient but affordability is a growing concern, with tenants spending nearly a third of their income on rent. The introduction of the Renters Rights Act (RRA) is influencing landlord behaviour, encouraging a move away from quickly filling properties towards securing tenants for the long term. Periodic tenancies are becoming the norm, reflecting a shift to sustainable, longer-term rental arrangements.
Ennis explains that success in the current market depends on matching the right tenant to the right property and fostering tenancies that benefit both parties. This marks a strategic change for landlords, who must now balance demand with regulatory compliance and tenant expectations for quality and value.
Context and evolving rental market dynamics
The rental sector in the UK is adapting to a complex environment shaped by rising costs, demographic shifts and new legislation. The Renters Rights Act, which strengthens tenant protections and promotes longer tenancies, is reshaping landlord approaches to letting. Rather than prioritising speed of letting, landlords and agents are focusing on tenant suitability and tenancy sustainability.
At the same time, regional variations in demand and rental growth highlight the importance of location-specific strategies. Areas outside London are seeing notable rent increases and tenant interest, driven by affordability and lifestyle factors. This diversification may offer opportunities for landlords willing to invest beyond traditional urban centres.
Practical implications for landlords and agents
For landlords managing small portfolios, the data underscores the need to review rent levels regularly to reflect market trends while considering tenant affordability. The shift towards longer tenancies under the RRA means landlords should prioritise tenant screening and relationship management to reduce turnover and void periods.
Letting agents must adapt marketing and management practices to align with tenant priorities for quality homes and long-term security. This includes ensuring compliance with evolving regulations and maintaining clear communication with tenants about their rights and responsibilities under the RRA.
Landlords should also monitor regional market conditions closely. In growth areas such as Kent and the North West, increasing rents and tenant demand may justify investment in property upgrades or portfolio expansion. Conversely, in high-cost markets like London, balancing rent levels with tenant retention strategies is critical.
Remaining uncertainties and considerations
While the Renters Rights Act is driving significant change, some details around its long-term impact remain unclear. The extent to which landlord costs and rental prices will be affected by regulatory compliance, and how tenant behaviour will evolve in response, are ongoing questions. Additionally, economic factors such as inflation and wage growth will continue to influence affordability and demand.
Landlords and agents should keep abreast of government guidance and sector developments to ensure their practices remain compliant and effective. The evolving legal landscape may also prompt further reforms, requiring flexibility and proactive management.
Key actions for landlords in the current market
- Review and adjust rent levels to reflect regional market trends and tenant affordability.
- Focus on securing long-term tenants through thorough screening and relationship building.
- Ensure compliance with the Renters Rights Act and maintain clear documentation of tenancy agreements and communications.
- Monitor local demand patterns to identify opportunities for portfolio growth or property improvements.
- Stay informed about regulatory changes and sector guidance to anticipate future requirements.
Supporting landlords with compliance and management tools
The Landlord Association (TLA) offers valuable resources to help landlords and letting agents adapt to the changing rental market and regulatory environment. Through TLA membership, landlords can access up-to-date compliance information, practical guides on tenancy management, and support with documentation tailored to the Renters Rights Act requirements.
TLA’s new property management and compliance platform, ORBIT, currently in BETA testing, is designed to assist landlords in organising property records, managing tenancy documents, and recording key actions such as inspections and communications. This platform aims to simplify compliance with evolving regulations and support landlords in maintaining well-managed tenancies.
Exploring TLA membership and ORBIT BETA access can provide landlords with practical tools and information to meet their obligations and optimise their rental operations in a market where tenant expectations and legal requirements continue to evolve.
Looking ahead, landlords will need to balance rental income goals with tenant affordability and regulatory compliance. Staying informed and prepared will be essential to navigate the complexities of the UK rental sector in 2026 and beyond.
Sources: Letting Agent Today
TLA - The Landlord Association