Average rents outside London rose by 1.9% in the second quarter after a decline in the supply of available homes, Rightmove’s latest index shows.
The average advertised rent outside the capital reached a record £1,397 per month in the second quarter, which was 2.3% higher than the same quarter last year.
In London, rents rose 2% in the second quarter to reach a new high of £2,791, which was 2.9% higher than a year earlier.
The price increases were partly stimulated by the first annual decline in the number of available rental properties since 2022.
Rightmove says rental stock is now 1% lower than a year ago as fewer properties have come onto the market.
Despite the decline in supply, competition among tenants remains well below the post-pandemic peak, the portal said.
The average rental property now receives 10 applications, compared to 11 a year ago and 22 at the peak of the market in 2022.
Rightmove’s buy-to-let mortgage tracker shows that average two-year fixed rates without fees have fallen to 5.55%, down from 5.67% last month, although they are still above the 5.2% of a year ago.
The report shows that annual rental growth remains strongest in the North of England, with both the North East and North West recording an annual increase of 4.1%, compared to 1.5% in the East Midlands and East of England.
Rightmove says the figures are the first to reflect market conditions following the introduction of the Renters’ Rights Act in May and that trends currently appear stable and broadly in line with seasonal norms.
Rightmove property expert Colleen Babcock says: “We are seeing new record average rents advertised in both London and the rest of Britain outside the capital, but overall we are seeing rents returning to more familiar seasonal patterns and stable growth.
“Even if supply no longer increases, the market remains much more balanced than at the peak of competition in 2022.
“Regional trends also continue to vary significantly across the country, with the more affordable northern areas continuing to see the strongest rental growth.
“London has seen a notable increase in rental prices this quarter, as well as the largest decline in available rental supply, underscoring how local supply and demand dynamics continue to shape rental prices.”