New research from Zoopla has found that UK renters are currently facing the lowest level of competition for homes in six years as demand falls and the number of homes rises.
The latest Rental Market Report shows that demand among renters is down 14% compared to the previous year, while the number of homes available for rent increased by 11%. As a result, Zoopla says that rents for new lets increased by just 1.9% over the last year.
The report found an average of 4.8 enquiries per property, down from 6.5 a year ago, which Zoopla says is clear evidence of the rental market becoming more balanced after a peak in competition for rented homes seen in 2022 and 2023.
Improving conditions in the mortgage market for first-time buyers and a continued decline in migration into the UK for work and study are the primary drivers of lower demand for rented homes. The latest ONS estimates reveal net migration into the UK peaked at 944,000 people in the year to March 2023, and this has slowed to 204,000 in the year to June 2025.
With three-quarters of first time buyers coming out of the rental market, more favourable conditions in the mortgage market have boosted first-time buyer numbers, reducing demand for rented homes. This has helped to free up the number of homes for rent, which explains the growth in supply.
However, the shift is not purely down to first-time buyers, with this increase also stemming from would-be sellers deciding to place their properties into the rental market – particularly if they are struggling to sell.
The changing dynamics of supply and demand also mean that homes are taking longer to rent. On average, finding a tenant now takes 20 days – a week longer than 2022’s peak of 13 days. For renters, this provides more choice of properties and more room for negotiation.
The report also suggests a stronger performance in Northern England and Scotland, with rental growth remaining stronger in the more affordable markets. Liverpool and Newcastle recorded growth of 4.6% and 4.5% respectively.
In contrast, several cities across the Midlands and Southern regions are seeing lower or even negative price growth, with Bristol growing at 0.8%, Cambridge at just 0.1%, and the likes of Birmingham (-0.7%) and Nottingham (-0.8%) falling. In London, rents are growing at a relatively low 1.7%, with the average rent now sitting at £2,187.
Richard Donnell, executive director at Zoopla, said: “Market conditions for renters are the best they have been for 6 years.. The rental market is moving back towards balance as demand cools and more homes become available to rent. Renters are facing less competition for homes and slower rent increases than in recent years. Localised changes in demand and supply are resulting in rents falling in some cities, but this will be only a short-lived trend.”
“The rental market is moving back towards balance as demand cools and more homes become available to rent. Renters are facing less competition for homes and slower rent increases than in recent years.”
“However, supply remains well below pre-pandemic levels, which means increasing the number of rental homes remains key to improving affordability for the UK renters over the long term.”
