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Tenant households seeing the highest inflation rate of 3.6%: "further evidence of the perfect storm many tenants find themselves in"

ended 29. May 2025

New data published this morning has revealed that private renter households had the highest annual inflation rate of 3.6% in March 2025, reflecting rising private rental payments; this was followed by social and other renter households, which had a 3.0% inflation rate in the year to March 2025. In contrast, outright owner occupiers experienced the lowest annual inflation rate of all tenure types, at 1.8% in the year to March 2025; mortgagor households had the next lowest (2.8%). Meanwhile, overall UK household costs, as measured by the Household Costs Index (HCI), rose by 2.6% in the year to March 2025; this is a fall from 2.9% in the year to December 2024. Newspage asked property and mortgage experts for their views, below.

6 responses from the Newspage community

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Editor
Rob Mansfield
Independent Financial Advisor at Rootes Wealth Management
Whilst inflation has a headline value, what this data shows is that inflation is much more personal. There are more people wanting homes than are available and so price rises are to be expected. This is a trend that's likely to continue. The Government is trying to build new homes but it'll take time for it'll happen.
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Emma Jones
Managing Director at Whenthebanksaysno.co.uk
This data is further evidence of the perfect storm many tenants find themselves in. Rents have risen sharply in recent years, as many landlords have seen their mortgage rates increase and have had no choice but to adjust what they charge. It was always difficult for those in rental to save for a deposit to get onto the property ladder but now it's becoming monumentally difficult. It always seems to be the people who can least afford things that pay the most.
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Riz Malik
Independent Financial Adviser at R3 Wealth
Once tenant costs increase, they rarely decrease, particularly with many landlords raising rents due to the 2022 mortgage rate hikes following the infamous mini-Budget. This gap continues to grow, and while some may manage to get onto the property ladder, many will remain part of the "generation rent," moving from renting whole properties to just rooms. This situation is especially challenging for those in the South East or working in major cities. Maybe once the 1.5 million homes are built or with the return of 100% mortgages, things may be different. Let's see.
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Pete Mugleston
Mortgage Advisor & Managing Director at onlinemortgageadvisor.co.uk
This data shows how vulnerable renters are in the ongoing cost-of-living crisis and the sharp differences between renting and owning a home. This will only make it harder for those currently renting to save up for a deposit and get onto the property ladder. It's more imperative than ever that the government reaches its housebuilding target by the end of the parliament to increase the housing supply. But the prospects don't look great, and the same applies to renters' fortunes if these figures don't improve soon.
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Michelle Lawson
Director at Lawson Financial
Inflationary pressures are very much still alive and kicking and will continue to rampage through householder's finances sadly. Mortgage rates are increasing as the Government just can't seem to get a grip of the real world and in the real world there are also a lot of unrealistic people. There are properties out there available to buy- on a Rightmove search today there are just under 2500 properties available to buy in Hampshire (not retirement homes or buying schemes) up to £200k. There are 530 properties available to let in Hampshire up to £1k per month not including retirement, house share or student accommodation. If there were no properies these figures would be much lower if any at all. As a result of a lack of financial education and pressures people now have poorer credit files along with different expectations and expenditure habits. There is more choice for landlords, we have 100% mortgages- there are options.
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Kundan Bhaduri
Entrepreneur, Investor and Landlord at The Kushman Group
Landlords have been cast as villains while being trapped in a perfect storm of government overreach and soaring costs. Mortgage rates have nearly doubled in the last 3 years and tax policies continue to punish investment, while Labour's new EPC rules make Caesar's marching orders seem modest. At the same time, eviction procedures now cost thousands. It wouldn't be unfair to say that tenants now have more rights than the United Nations Charter. Over 400,000 rental properties have vanished since 2016 because providing affordable homes has ironically become unaffordable for the sector. Come on, we are not profiteers. We are everyday investors trying to secure our future and help others afford theirs. However this government is betting on fantasy economics while at the same time expecting rental stock to flourish while they strangle landlords in red tape. If the government truly wants affordable homes, it should stop treating landlords like cash cows, before there are none left to milk.