London muted as Asian markets hit record highs amid easing US-China trade tensions

The average advertised rent for homes outside London rose again in the third quarter of 2025 to a new record of £1,385 per calendar month, according to data from Rightmove (RMV.L).

Average rents outside the capital are now 3.1% higher than a year ago, marking the third consecutive quarterly record this year.

Average advertised rents in London also reached a new high of £2,736, though the pace of growth in the capital has slowed to just 1.6% annually, the lowest figure since the second quarter of 2020.

The total number of homes available to rent continues to edge closer to pre-pandemic levels, but the flow of new listings has slowed. The number of available rental homes is now 9% higher than it was a year ago, although it remains 23% below the same period in 2019. This marks the closest the market has been to pre-pandemic supply levels in four years.

However, the number of new rental listings coming to market is only 1% higher than a year ago, the lowest figure recorded in 2025. Tenant demand has also cooled and is 14% lower than at this point last year.

Analysts say the slower pace of new rental supply reflects growing caution among landlords amid changes to taxes and regulations.

An increase in stamp duty for rental home purchases introduced in October last year, alongside rumours of a potential national insurance tax for landlords in the upcoming autumn budget, has added uncertainty to the market. The forthcoming Renters’ Rights Bill is also influencing decisions.

Affordability remains stretched for both tenants and landlords. Despite average earnings rising by 5% compared with last year, outpacing rent increases, the cost of renting still consumes 44% of the average wage, up from 40% five years ago. For renters saving for a first home, a 20% deposit has risen by just over £5,000 in five years, from £40,326 to £45,374.

Daniel Fisher, head of lettings at John D Wood & Co, said: