Gloomy forecast for tenants as rent rises set to speed up
The cost of renting is expected to rise by 4% or 5% a year by December, according to property website Zoopla.
By BBC News
Tenants are being warned to expect faster rent increases, with Zoopla forecasting that annual rises in privately rented homes could reach 4% or 5% by December 2026.
According to a report by the BBC, average rental costs for new tenancies were already 2.6% higher in July compared to the previous year. While this increase is still below the general rate of price rises, rents are anticipated to accelerate further in the coming months.
The BBC article, published on 13 September 2026, noted that the predicted rent increases would align closely with the average annual rise in workers' earnings. It highlighted a decrease in the availability of rental properties, which, combined with higher mortgage rates discouraging potential first-time buyers, has intensified competition for rental homes in some areas.
Richard Donnell, executive director at Zoopla, stated that the rental market is sensitive to changes in the availability of homes for rent. He emphasised that increasing the number of rental properties through investment is essential for providing more choices for renters and ensuring long-term stability in rent levels.
The report also mentioned that the Renters' Rights Act, which came into effect in May, represents a significant change in the rental sector. Despite a recent low of 1.6% in rental cost increases earlier this year, the number of homes available for rent has decreased by 3% compared to a year ago, leading to heightened competition among prospective tenants.
While rent rises are being observed across the UK, the situation varies by location. In less expensive areas, renters may have more capacity to absorb increases, whereas in pricier regions, rents are already at a stretch for many tenants.
The forecast from Zoopla indicates a further acceleration in rent increases, with the expectation that they will reach 4% or 5% by the end of the year, which is still in line with the average annual rise in wages.