What drives UK rental prices? Ten years of evidence

Here is what the evidence actually shows, and where it points next.

Updated 27 August 2026

The key facts

• Net migration peaked at 944,000 in the year to March 2023 and ran at 171,000 in the year to December 2025. ONS, provisional, May 2026.
• Rent inflation peaked at 9.1% in March 2024 and was 3.7% in the 12 months to July 2026. ONS Price Index of Private Rents.
• Demand per property has roughly halved. Zoopla enquiries per rental home fell from 15.5 at the 2022 peak to 5.6 in May 2026. Our own viewing requests per property fell from 69 to 34, January to July average, 2023 against 2026.
• The English private rented sector holds 5,030,000 dwellings, 19.5% of all stock at 31 March 2025, against a 20.3% peak in 2016. MHCLG.
• England added 208,600 homes in 2024-25, against the 300,000 a year long used as a benchmark. MHCLG net additional dwellings.

In this article:

1. What actually sets rental prices
2. Why has demand changed so much
3. How closely did rents follow migration
4. How do we measure demand day to day
5. Has rental supply really collapsed
6. Are tenants staying longer
7. Is Build to Rent big enough to matter
8. Is Britain building enough homes
9. When does affordability stop rent rises
10. Will buying get any easier
11. How many young adults are waiting to rent
12. Is the Renters' Rights Act changing how landlords price
13. What happens next

What actually sets rental prices

Rental prices are set by the interaction of three variables: how many households want to rent, how many homes are available to let, and how much tenants can realistically pay.

Demand is the number of households looking for a rented home. Supply is the number available to let, which is not the same as the number of rental homes in existence. Affordability is the ceiling, and it works slowly.

When demand grows faster than supply, rents rise. When affordability reaches its limit, rent growth slows. Over the last decade all three moved, but demand moved furthest and fastest, which is why it does most of the explaining.

Why has demand changed so much

Demand changed because the number of households needing to rent grew sharply, and migration was the largest single reason.

The private rented sector absorbs people whose lives are changing. Students rent. Young professionals rent. People relocating for work rent. Families moving between areas rent. People arriving in the UK rent, and they do so disproportionately.

Census 2021 shows the pattern clearly for England and Wales. Private renting was highest among EU-born residents at 53%, followed by non-EU-born at 36%, and lowest among the UK-born at 16%.

Part of that is structural rather than preference. Work, study and family visas carry the No Recourse to Public Funds condition, so social housing and most benefits are not available. That leaves the private rented sector, purpose-built student accommodation, employer accommodation, or staying with family. The condition is not universal: refugees, people granted humanitarian protection, victims of trafficking and those on the Ukraine schemes sit outside it, and the condition can be lifted on family routes where a household is destitute or a child's welfare requires it.

Work and study dominate the arrivals that land in renting. In the year to December 2025, work and study together accounted for 70% of non-EU+ arrivals. In the year to December 2023, at the peak, it was 78%.

How closely did rents follow migration

Rent inflation followed the migration surge with a lag of about a year: net migration peaked at 944,000 in the year to March 2023, and UK rent inflation peaked at 9.1% in March 2024.

Three caveats matter more than the shape of the table, and we would rather set them out than let a reader find them.

First, the series starts at 2021 on purpose. The ONS applied its improved migration methods back to the year ending June 2021 only, and warns against comparing figures across that break. Earlier years exist but they are not the same measure. The recent figures have also moved repeatedly: the year to December 2024 was published as 431,000, revised to 345,000, and now reads 331,000.

Second, the two rent columns are not the same measure. The Price Index of Private Rents covers the entire privately rented stock, existing tenancies included, so it is slower and shallower than a new-let index. Zoopla's figure covers new lets only, which is why it turns first and turns harder.

Third, that difference is the mechanism behind the lag. A price collected for the ONS index stays in it for up to 14 months until an updated price arrives, and the average tenancy now runs close to three years, so a new-let increase takes time to show up in a whole-stock measure.

None of this says migration alone sets rents. Mortgage rates, household formation, wages, landlord investment and regional economies all matter. But the period of exceptional growth in the renting population coincided with the sharpest rent rises in the series, and the sequencing is hard to explain any other way.

How do we measure demand day to day

Enquiries per available property are the sharpest short-term read on demand, and they have fallen by roughly two thirds since 2022.

Every viewing request is one household competing for one home. The more enquiries an available property attracts, the greater the imbalance between demand and supply, and the sooner that imbalance shows up in what a landlord can ask.

Zoopla's market data puts the change plainly. Enquiries per rental home averaged 5.6 in May 2026, down from a peak of 15.5 in 2022. Zoopla also notes that demand remains well above 2017 to 2019 levels, which is part of why rents keep rising even as competition eases.

Our own viewing-request data tracks the same direction and gives us a faster read, because we see it property by property rather than as a national average. On a like-for-like January to July basis it has halved in three years, from 69 requests per property in 2023 to 34 in 2026.

Hello Neighbour viewing requests per available property, monthly, with the change on the previous month. January is compared with the preceding December. The July 2023 peak of 93 is the busiest month we have recorded. Since the start of 2025 the range has been narrow, mostly 30 to 50, which is what a more balanced market looks like from the inside.

Three things stand out that a national quarterly figure would hide.

The seasonal shape is strong and repeats every year: demand builds through spring, peaks in high summer, and falls away to a December low. July has been the busiest month in three of the four years.

The month-on-month swings are large even in a quiet market. A single month can move 20% or more in either direction, which is why we would not read one month as a trend, and why a landlord pricing off last month's competition alone can get it wrong.

And the decline has slowed. Requests fell 27% between 2023 and 2024 on the same seven months, then 17% between 2025 and 2026. That is the profile of a market finding a floor rather than one still in retreat.

The value of a daily measure is that it catches things a quarterly index cannot. Advertised rents have risen firmly over recent months even with fewer enquiries per property, which looks contradictory. Our reading is that it reflects landlord behaviour rather than a return of demand, and we come back to that below.

Has rental supply really collapsed

No. The English private rented sector holds more dwellings than at any point in this series, 5,030,000 at 31 March 2025, and has grown for six consecutive years.

What has fallen is its share of a fast-growing housing stock: 19.5% in 2025 against a 20.3% peak in 2016.

The shape is a rapid climb to 2016, a dip to a low point of 4,762,000 in 2019, then a rise of 268,000 across the six years since. Set against 2001 the sector is 2.36 times its size, an increase of 2,897,000 dwellings. The full annual series is in the MHCLG dwelling stock estimates.

That sits awkwardly next to the exit numbers, and both can be true. TwentyCi's Q2 2026 report, drawn from around 4.5 million UK properties listed to rent since 1 January 2016, is headlined "834,800 landlords gone". It counts departures rather than the net change in stock, and TwentyCi present build to rent additions separately as an offsetting factor, so a large gross exit figure does not contradict a stock count that has risen. Their unit is landlords rather than properties, and they publish no methodology note on the figure, so we would not restate it as a property count.

Many landlords have left, for reasons that are well rehearsed: tax changes, mortgage interest restrictions, higher borrowing costs and more regulation. Selling did pick up in the first half of 2026. It has not yet shown up in the overall level of supply.

A broadly static stock can still produce shortages. It happens when demand rises quickly, and it happens when the same homes come to market less often.

Are tenants staying longer

Yes, and it is the supply story that matters most. Average tenancy length recorded by the Deposit Protection Service rose 40% in four years, from 773 days in 2021 to 1,085 days by April 2025.

If tenants stop moving, fewer homes come to market each year even though the total number of rental homes does not change. New renters then compete for a smaller pool.

The DPS holds 1.87 million deposits, around 40% of the England and Wales market. The 1,085-day figure is a part-year reading as at April 2025, so treat it as the latest point rather than a settled annual average. The DPS does not publish its methodology, so we would not claim to know exactly which tenancies it counts.

The English Housing Survey measures something different and gets a longer number. In 2024-25 private renters had lived in their current home for an average of 4.7 years, against 12.2 years for social renters and 17.0 years for owner occupiers. It is higher than the DPS figure because it measures time in residence so far, including long tenancies still running, rather than tenancies that have ended.

The distribution matters more than either average

The private rented sector is not one market, and the spread of tenure lengths shows why. On the English Housing Survey 2022-23, the most common length of residence for private renters was under one year, and more than half of renters aged 16 to 24 had been in their home less than twelve months. At the other end, the most common length of residence for renters aged 75 and over was 10 to 19 years. The 2023-24 survey put the under-one-year group at 20%.

Total time spent renting is a separate measure again, and a longer one: 39% of private renters had been renting privately for between three and ten years, and a further 30% for ten years or more.

Region changes the picture too. Our own data across more than 2,000 London properties shows an average tenure of 26 months, below the national figures, which is what you would expect: London has the lowest median age of any English region at 35, and the highest share of households privately renting at 30.0%. A market with a highly mobile younger population turns over faster, and its available supply refreshes faster with it.

Is Build to Rent big enough to matter

Not yet. Completed Build to Rent homes represent about 2.7% of the private rented sector, and the entire pipeline including everything in planning would take it to around 5.5%.

Those are British Property Federation figures for the UK, compiled with Savills and Molior, and they include single-family Build to Rent houses as well as apartment blocks. Houses are roughly 12% of the pipeline. The percentages above are measured against around 5.5 million privately rented dwellings in Great Britain at 31 March 2023, so they mix a UK numerator with a Great Britain base, which is close enough for scale and not for precision.

The economics explain the pace. Build to Rent depends on institutions buying land and funding construction with borrowed money, so higher interest rates slow new projects directly. Build costs have risen, and planning consent normally carries an affordable housing requirement, which has to work alongside everything else in the appraisal.

Build to Rent matters more than its share suggests, because these are new homes arriving in the rental market rather than existing ones changing hands, and new supply is what a tight market needs. It is still too small to move national rental supply on its own.

Is Britain building enough homes

No. England added 208,600 net additional dwellings in 2024-25, roughly 91,000 short of the 300,000 a year long used as a benchmark, and the sixth consecutive year below it.

That is a cumulative shortfall of 434,900 homes in six years, on the current MHCLG series. Earlier years are shown as MHCLG now publishes them rather than as first released, because these figures get revised.

The 300,000 benchmark needs a word of explanation, because it is often quoted as though it were a fixed law. It began as an external estimate traced to the 2004 Barker Review, became a government target at Autumn Budget 2017, and is no longer how the commitment is expressed: the current pledge is 1.5 million net additional homes in England over this parliament, and the planning system's standard method now assesses annual need at roughly 370,400. Measured against that, the shortfall is larger, not smaller.

The longer-run gap is bigger again. Centre for Cities estimated in The housebuilding crisis that the UK would have 4.3 million more homes had it built at the average western European rate between 1955 and 2015. That is a comparison, not a construction schedule, and nobody is suggesting 4.3 million homes could be delivered now.

Rental supply cannot be separated from this. When too few homes are built for owner occupation, households that would otherwise buy carry on renting, which raises rental demand with no change at all in the size of the rental sector.

When does affordability stop rent rises

Affordability is the ceiling, and England is above it: an average private rent absorbed 36.3% of the median private-renting household's income in the financial year to March 2024, against the 30% the ONS uses as its affordability threshold.

Nine years of ONS data, England, financial years ending March. Rent comes from the Price Index of Private Rents, income from the Department for Work and Pensions Family Resources Survey. The share is one divided by the other.

Read down the columns and the mechanism is plain. Rent has risen every single year, but slowly for most of the period: 1.8%, 0.8%, 2.2%, 1.4% and 1.3% through FYE 2018 to FYE 2022. Income did the work in those years, rising 6.4% and 6.8% into FYE 2019 and FYE 2020, which is why the ratio fell from 39.4% to 35.4% while rents were still creeping up.

Then both lines turned at once. Rent growth accelerated to 5.1% and then 7.9%, the fastest in the series, while income growth went from plus 13.1% in FYE 2023 to minus 1.5% in FYE 2024. That is the whole of the 3.2 point jump in the ratio, from 33.1% to 36.3%, and it is the clearest evidence in this piece that affordability is squeezed from both ends rather than by rents alone.

Two things to hold on to. The ratio oscillates rather than marching in one direction, because rents and incomes take turns: 38.0% in FYE 2021 was worse than the 35.7% that followed it. And that FYE 2021 spike came from income falling 5.5%, not from rents, which rose 1.4% that year.

One note on the numbers, because it matters if you check them. The ONS revised this whole series in its 2024 edition and every overlapping year moved down: FYE 2023 from 34.2% to 33.1%, FYE 2022 from 36.5% to 35.7%, FYE 2016 from 39.9% to 39.4%. Everything above is taken from the current edition, so the table is internally consistent. Older commentary quoting 34.2% for FYE 2023 is on the superseded basis. A FYE 2015 figure exists only in the retired edition, which is why this table starts at FYE 2016.

Income growth is the reason the ceiling bends rather than breaks, and in 2026 it is bending less. Regular pay rose 3.5% in the three months to June and private sector regular pay only 2.8%, while rents rose 3.7% in the year to July and CPI inflation ran at 2.9%. Rents rising faster than private sector pay is precisely the condition that produced the FYE 2024 deterioration, and it is the condition we are in now.

Markets cannot ignore household incomes indefinitely. When tenants cannot pay more they find alternatives, and the most common alternative is not moving at all.

Will buying get any easier

Not quickly. England's median house price was 7.6 times median earnings in 2025, the lowest ratio since 2015 but still comfortably above the five times earnings the ONS uses as a benchmark.

The ratio has been improving from a 2021 peak of 9.1, standing at 7.8 in 2024 and 7.6 in 2025 on a median house price of £300,000 against median earnings of £39,300. Improving from a record high is not the same as becoming affordable.

For a first-time buyer the monthly payment is rarely the binding constraint anyway. Deposits, lending multiples and affordability tests decide who can make the move, and none of them have loosened enough to matter. Persistent purchase unaffordability is what keeps demand for rented homes high, and we do not expect it to change much in the medium term.

How many young adults are waiting to rent

Roughly 28.7% of UK adults aged 20 to 34 lived with their parents in 2025, up from 25.4% in 2015, which is a queue of delayed households rather than current rental demand.

The census shows the trend more sharply still. Between 2011 and 2021 the proportion of 20 to 24 year olds in England and Wales living with parents rose from 44.5% to 51.2%, and among 25 to 29 year olds from 20.1% to 26.7%. The recent increase is driven by men, from 30.5% to 34.9%; the change among women was not statistically significant.

These households are not in the market today. They are household formation that has been postponed, and if affordability improves some of it returns, to both renting and buying. That is why a more balanced rental market is unlikely to become a weak one.

Is the Renters' Rights Act changing how landlords price

Early evidence suggests yes, at the advertising stage, though it is too soon to show a market-wide effect in the data.

The older approach was to accept a lower initial rent to secure the right tenant, then adjust gradually over a long tenancy. Since the Renters' Rights Act came into force on 1 May 2026, increases have to be more structured and tenants have clearer routes to challenge an increase above market level.

What we are seeing is landlords pricing high at the point of advertising, on the view that in-tenancy increases are now harder to land. It fits the otherwise contradictory picture of firm advertised rents alongside fewer enquiries per property. The gap between advertised and achieved rent is hard to track, but early signs are that the tactic is producing higher rents today.

We do not think it lasts. A rent set above what the market will bear is exactly what the challenge mechanism exists to correct, and a property that sits empty while the landlord waits costs more than the increase was worth. For now, though, it is a real short-term effect on advertised prices.

What happens next

Continued moderate rent growth, roughly in line with wages, in a market that has already become more balanced.

Migration has already fallen sharply after changes to work visas, student dependant rules and overseas recruitment. A further large fall looks unlikely, so demand from that source is more likely to hold than to drop again.

Housebuilding ambitions and planning reform could improve overall supply, but the scale and timing make a meaningful dent in rental demand improbable given the accumulated backlog. Build to Rent will keep growing from a small base, and for it to accelerate, funding and land costs have to improve.

Affordability will keep acting as the pressure valve. With private sector pay at 2.8% and rents at 3.7%, that valve is already working.

The risks run in both directions. Supply is vulnerable to tenancies lengthening further and to a larger landlord exodus if one materialises. Demand has a reserve in the young adults still living at home. Any boost from tactical pricing under the Renters' Rights Act is unlikely to be sustained.

Rental prices are not set by landlords alone, nor by migration alone, nor by housebuilding, mortgage rates or regulation in isolation. They are set by the interaction of demand, supply and affordability, and the last decade is a clean demonstration: demand changed far more than the stock of rental housing did, exceptional migration added households disproportionately likely to rent at precisely the moment supply was constrained, competition surged, and rents followed. Now migration has fallen and affordability is stretched, so rental inflation is moderating. Supply is still tight. That combination points to moderate growth, not another surge and not a correction.

Sources

Office for National Statistics

• Long-term international migration, provisional: year ending December 2025, and Improving long-term international migration statistics, November 2025
• Private rent and house prices, UK, August 2026, and the Price Index of Private Rents detailed methodology
• Social characteristics of international migrants, England and Wales, Census 2021
• Private rental affordability, England, Wales and Northern Ireland, dataset, FYE 2016 to FYE 2024
• Housing affordability in England and Wales, 2025
• Families and households, UK, 2025, and More adults living with their parents
• Average weekly earnings in Great Britain, August 2026, and Consumer price inflation, July 2026
• Private rented sector statistics from across the UK, 2025

Government

• MHCLG, Dwelling stock estimates, England: 31 March 2025
• MHCLG, Housing supply: net additional dwellings, England, 2024 to 2025
• MHCLG, English Housing Survey 2024-25, Chapter 3, and the 2022-23 and 2023-24 rented sectors reports
• Home Office, Public funds guidance on the No Recourse to Public Funds condition

Parliament

• House of Commons Library, Tackling the under-supply of housing in England, briefing CBP-7671, on the provenance of the 300,000 benchmark
• House of Commons Library, No recourse to public funds, briefing CBP-9790

Sector

• Zoopla Rental Market Report, June 2026, and earlier editions for the new-let growth series
• British Property Federation, Build to Rent statistics, Q1 2026, compiled with Savills and Molior
• The Deposit Protection Service, Average tenancy now more than 1,000 days
• TwentyCi Property and Homemover Report, Q2 2026
• Centre for Cities, The housebuilding crisis: the UK's 4 million missing homes, February 2023
• Hello Neighbour viewing request and tenancy data, London, August 2026

This article is general market commentary and not investment or legal advice. Figures are as published at the time of writing, and housing statistics are frequently revised.

If any of this is making you think about what your own property should be advertised at, our rental valuation report gives you the local comparable evidence, and our landlord economics piece looks at what is left after costs.