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Rental market trends show rising rents but landlords face longer voids

Rental prices across England saw an increase in January 2025, with the average cost rising nearly 2% month-on-month and 4.6% year-on-year. However, despite the upward trend in rents, landlords are experiencing longer void periods, which suggests shifting market conditions.

Rents continue to climb across most regions
According to the Goodlord Rental Index, the average rental cost per property reached £1,207 in January 2025, up from £1,154 in January 2024. This marks an acceleration in the pace of rental growth compared to December’s more modest 3.3% annual increase. The North East saw the highest annual rise at over 8%, while the East Midlands recorded the smallest increase at just 1%.

Month-on-month, rental prices rose by nearly 2%, from £1,185 in December to £1,207 in January. This is consistent with the typical trend of rising rents between December and January. London remains the most expensive region, with rents averaging £2,044 per month, up 3% from December, while the North East remains the most affordable at £911, marking a 5% increase.

The only region to see a decline in rents was the South East, where prices dipped by 0.6%.

Advertised rents exceed confirmed rental prices
Despite the increases, a growing disparity between advertised and confirmed rental prices suggests that landlords are negotiating lower rents than initially listed. Goodlord’s analysis of rental trends compared its confirmed rental data with Rightmove’s advertised rental prices. The findings revealed that, in Q4 2024, final rental agreements were up to 20% lower than advertised prices outside London and 24% lower in London.

Rightmove’s reported advertised prices for Q4 2024 were £1,341 per month outside of London and £2,695 in the capital. However, Goodlord’s tracker showed that actual tenancy agreements finalised during the same period averaged £1,070 per month outside London and £2,046 in London.

William Reeve, CEO of Goodlord, noted this trend, stating: “The market continues to show upward pressure on rents, but tenants are increasingly negotiating lower prices. We are seeing a softening in the market.”

Void periods reach longest levels since 2021
Void periods, which measure the average time a rental property remains unoccupied, have reached their highest level in nearly four years. Void lengths increased from 21 days in December to 24 days in January, the longest since April 2021. This suggests that while rents are increasing, demand may be cooling slightly.

The West Midlands saw the sharpest rise in voids, jumping from 18 to 23 days, a 28% increase. The South East was the only region to maintain steady void periods at 22 days, which also aligns with its status as the only region to record a reduction in average rents.

Reeve commented on this trend, saying: “Whilst we predict that confirmed rental prices will continue to rise this year, particularly over the summer, wider indices imply it’s unlikely 2025 will bring the major rise in year-on-year figures we saw last year.”

 

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