Labour’s plan to transform the Oxford-Cambridge Arc into “Europe’s Silicon Valley” is set to send rental prices soaring, with new analysis predicting increases of up to 23% across the region. According to insights from Zero Deposit, the combination of infrastructure development and economic expansion will drive unprecedented demand in the rental market.
Rent prices already climbing across key locations
Rental prices across the 12 locations along the proposed East West Rail route, which will form the backbone of the Oxford-Cambridge Arc, have already experienced a significant surge over the past year. Data shows an average increase of 7.8%, bringing the regional monthly rent to £1,346.
Bedford has recorded the sharpest rise at 9.5%, with the average rent now standing at £1,084 per month. Meanwhile, Cambridge, set to benefit from two key stations—Cambridge and Cambridge South—has seen rents increase by 9% to reach £1,747 per month.
Central Bedfordshire, home to Tempsford and Marston stations, has seen rents climb 8.8% to an average of £1,160 per month, while Oxford now commands an average of £1,789 following an 8.6% rise. South Cambridgeshire’s Cambourne also saw robust annual growth of 8.2%, pushing the average monthly rent to £1,327.
Rental prices expected to rise by over 20% in next 12 months
With the region already seeing strong growth, Zero Deposit forecasts that the combination of the East West Rail project and wider development plans will push rental values even higher. Using historical trends and the estimated 12% infrastructure-related boost seen in similar projects, rental prices across the 12 key locations could rise by an average of 21% over the next year.
Bedford is predicted to experience the highest increase, with rents projected to climb 23% to £1,328 per month. Cambridge properties near the two new stations are expected to see a 22% rise, taking the monthly average to £2,131. South Bedfordshire is also set for a 22% increase, meaning rents could hit £1,413.
Oxford and Cambourne are forecasted to experience a 21% uplift, pushing average monthly rents to £2,173 and £1,607, respectively. These steep increases reflect the mounting demand as businesses and workers flock to the area.
Landlords set to benefit—but affordability concerns remain
With major tech giants such as Microsoft and Amazon already established in the region, the Arc’s development is poised to attract further innovation, employment, and economic prosperity. Sam Reynolds, CEO of Zero Deposit, emphasised the positive impact on landlords:
“This will result in huge job creation for the area, which will bring new demand to the rental market, and rent prices will inevitably increase as a result.”
However, Reynolds also acknowledged the challenges tenants may face. “Many of the new jobs will be highly desirable and relatively well-paid, but with rent prices having the potential to surpass £2,000 a month in some locations, people are still going to face an immense affordability challenge.”
To address these concerns, he urged landlords to consider deposit alternatives, stating that such schemes “provide tenants with a more affordable route to renting, leaving more cash in their pockets that will be essential for helping them settle into their new lives while also getting their feet under the table at new workplaces.”
Furthermore, with the anticipated introduction of the Renters’ Rights Bill set to limit advance rent payments to one month, landlords may find themselves with reduced financial protection against potential property damage or unreliable tenants. Reynolds highlighted that deposit alternatives could help bridge this gap: “By adopting a deposit alternative, landlords can maintain the level of protection they require without forcing tenants to hand over unaffordable amounts of cash.”
The Oxford-Cambridge Arc represents a huge opportunity for landlords, with soaring demand set to drive up rental values.
