England experiences a 28% surge in rental costs
Post-Pandemic Rental Market in England: A Balanced Shift
In the aftermath of the pandemic, the growing demand for rental properties from tenants is colliding with a shortage of stock and a complex set of pressures facing landlords. Despite these challenges, the rental market in England has been performing strongly, with rents and voids holding steady.
According to Goodlord's chief executive, William Reeve, rent rises have consistently outstripped inflation. This trend is evident in the current rental prices in England, which have risen significantly compared to pre-pandemic levels. As of mid-2025, the average asking rents outside London stand at around £1,360–£1,365 per month, marking a 44% increase since early 2020. However, the pace of growth has slowed considerably, with annual rent increases dropping to about 3.9–4% in 2025.
Regionally, the rental market varies. The South West has performed particularly strongly, with average rents now at roughly £1,480 per month, marking the 15th consecutive quarterly increase and annual growth of over 4%. The North West, exemplified by Manchester, saw rents for one-bedroom properties rise around 9% annually, with average rents near £958 per month. The North East, the cheapest English region, averages just over £700 per month, showing slight increases but remaining relatively affordable. London rents have seen slight rises month-on-month but remain about 0.9% lower than a year ago, showing a modest correction from earlier highs.
Forecasts for rental prices indicate continued growth but at a measured rate as the market stabilizes. The UK rental market is expected to grow cumulatively by nearly 18% by 2029, with an anticipated 8% rise in 2024 already realized. This growth is driven by ongoing demand, affordability challenges, and mortgage rate trends. Despite the slowing annual growth rates seen in recent quarters, structural factors such as limited housing supply and competition among tenants continue to exert upward pressure on rents.
As the market transitions toward a more balanced phase with slower growth, increased housing availability and landlords returning to long-term letting contribute to this rebalancing, giving tenants more options than during the acute demand peaks in 2021–22.
Summary of Trends by Region and Comparison to Pre-Pandemic Levels:
| Region | Approx. Current Avg. Rent (2025) | Annual Growth Rate (2025) | Increase Since Early 2020 | Notes | |--------------|---------------------------------|--------------------------|---------------------------|---------------------------------------------| | England (excl. London) | £1,360–£1,365 | ~3.9% | +44% | Growth slowing, market rebalancing | | South West | £1,480 | ~4.3% | Significant increase | Strong growth, 15th consecutive rise | | North West | £958 (1-bed avg) | 9% | Not specified | High annual increase, e.g., Manchester | | North East | £700+ | Slight increase | More affordable | Cheapest area, small growth | | London | Slightly below £1,313 UK avg | Slight month-on-month rise; 0.9% YoY decrease| Moderate changes | Down slightly year-on-year |
This data indicates that while rental prices remain elevated compared to the pre-pandemic period, the trend is moving toward slower, steadier growth with some regional variation reflecting local demand and supply dynamics.
Investors who are keen on real-estate business may find the post-pandemic rental market in England an attractive prospect for investing, given the steady growth in rent prices. To further capitalize on this trend, one could consider focusing on regions like the South West or the North West, where rents have seen significant increases and strong growth persists.
Landlords, navigating their way through the complexities in the rental market, such as the shortage of housing stock and pressures stemming from the pandemic, could potentially collaborate with financial institutions to secure funds and expand their property portfolios in strategically picked locations, like those mentioned above.
