This annual growth rate is down from 8.7% in the 12 months to January 2025 and significantly lower than the record-high annual rise of 9.1% in March 2024.
Average rents increased to £1,381 (8.3%) in England, £785 (8.5%) in Wales, and £998 (5.8%) in Scotland, in the 12 months to February 2025, according to the government figures.
In Northern Ireland, average rents increased to £832 (8.1%) in the 12 months to December 2024.
In England, annual rental inflation was highest in London (9.9%) and lowest in Yorkshire and The Humber (4.8%), in the 12 months to February 2025.
Alex Upton, managing director, specialist mortgages & bridging, at Hampshire Trust Bank, said: “Rising rents have become a reality for tenants, driven by a fundamental shortage of rental homes. However, there are signs of change.
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“Zoopla’s latest rental market report shows the number of renters competing for each available property has dropped to 12. It’s still high, but an improvement on recent years. This easing in demand may be contributing to a slowdown in rental growth, with Zoopla reporting the lowest level of increases in over three years.
“The elephant in the room is the Renters’ Rights Bill. While the legislation is designed to improve standards, which we fully support, there are concerns that it may reduce rental stock, at least in the short term. That could put upward pressure on rents again.”
“But change also brings opportunity. Professional landlords with a long-term mindset are already adapting, shifting their focus to properties that maximise rental yields. Brokers and lenders will need to do the same to support these evolving strategies. If they do, the real winners will be tenants, benefiting from a broader selection of high-quality rental homes in the future.”
