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Land Registry HPI and rental data: "It's less a rental market and more an iron maiden"

ended 19. February 2025

Average UK house prices increased by 4.6%, to £268,000, in the 12 months to December 2024, according to data published this morning; the annual growth rate is up from 3.9% in the 12 months to November 2024, although prices dropped 0.1% in December. Meanwhile, average UK private rents increased by 8.7% in the 12 months to January 2025, down from 9.0% in the 12 months to December 2024. Average rents increased to £1,375 (8.8%) in England, £780 (8.4%) in Wales and £995 (6.2%) in Scotland, in the 12 months to January 2025. In England, rents inflation was highest in London (11.0%) and lowest in Yorkshire and The Humber (5.3%), in the 12 months to January 2025. Newspage asked property and mortgage experts for their views, below.

4 responses from the Newspage community

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Andrew Montlake
CEO at Coreco
In the UK, it's less a rental market and more an iron maiden. Though rents have dipped slightly, they're still sky high. This may get worse as amateur landlords exit the rental sector, which is what we're seeeing more of. High rents, especially in the capital, are preventing tenants from getting onto the property ladder, as they struggle to save for a decent deposit. Meanwhile, due to the lack of supply, house prices continue to edge up, putting the dream of homeownership further out of reach for many. Mortgage rates have come down over the past week or so since the base rate cut but we need to see more competitive rates at higher loan-to-values to help those who need it most. The January inflation data is another stick in the spokes for borrowers, as it may mean rate cuts in March are delayed and only materialise later in the year. We have also still to see the full impact of the Budget, which has the potential to trigger lay-offs and job uncertainty, which may impact demand.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
In December, demand was busy right up to the point of Santa's sleigh leaving the North Pole, and the start of 2025 has also been bouyant. In part this is due to the rush to beat the stamp duty deadline and in part because the dream of getting on the property ladder is in this country's DNA. We have seen enquiry numbers up 130% on the same period in 2024. Despite a general lack of confidence in the economy, buyers don't feel a better time to buy will be forthcoming anytime soon, so best to buy now and be on the ladder as house prices continue to increase. With rents remaining elevated, many tenants are increasingly keen to have their biggest monthly outlay not simply pay their landlords' mortgage but rather their own.
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Justin Moy
Managing Director at EHF Mortgages
With demand still outstripping supply both for purchasing and the rental markets, it's not surprising to see prices continue to hold or increase over the last 12 months. For rentals, the smaller landlords are selling and the corporate landlords are taking up market share at pace, whilst for first-time buyers the opportunity to own your home is still attractive, even with higher mortgage rates. Our population is growing quicker than properties can be built, so the economics will always be in favour of property ownership and rising prices.
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Ben Perks
Managing Director at Orchard Financial Advisers
High rents are concerning and leave tenants trapped in a vicious cycle of working to pay rent and unable to save for deposits. While landlords are persecuted and regulations make buy to let margins tighter and tighter, rents will continue to rise. Rather than chastising landlords, help them. The government need to change their stance on this and help landlords a little. If they had access to cheaper lending and taxation, the result would be fairer rents and everyone wins.