The Office for National Statistics (ONS) has reported that UK rental growth accelerated in July, with average private rents increasing by 3.7% year-on-year to £1,393. This marks the fastest annual rise since December 2025, with London seeing particular growth and the North East recording the highest rental inflation among English regions at 6.3%.
In contrast, ONS data indicates that annual UK house price growth slowed for a second consecutive month, dropping from 3% in May to 2% in June. The average property value now stands at £272,000. This slowdown reflects weaker price growth this summer compared to last year, and London experienced its tenth consecutive month of annual house price falls.
Industry experts have reacted to these figures, with Nathan Emerson, CEO at Propertymark, noting that a fall in house prices can create nervousness among sellers. Tom Bill, head of UK residential research at Knight Frank, suggested that rents are being pushed higher due to the Renters’ Rights Act, which has led some landlords to leave the sector or increase asking rents. Iain McKenzie, CEO of The Guild of Property Professionals, attributed the slowdown in property prices to competing pressures such as higher inflation, the Bank Rate remaining at 3.75%, and affordability constraints for many buyers.
Despite the slower price growth, mortgage approvals increased in June, and mortgage product availability has continued to improve, with major lenders beginning to reduce rates on residential mortgages again. Property transactions also stabilised, remaining ahead of 2024 levels in the first half of the year. Experts anticipate activity to pick up in the autumn, provided mortgage rates continue to ease and economic uncertainty does not intensify, though price growth is expected to remain modest.