The trend of rent growth gradually slowing continues, with an improvement in the supply and demand of rental properties having a big contribution to that. We can't keep seeing double-digit rent rises every year as tenant affordability simply cannot keep up, and 2024 is the year we think there will be a much smaller increase in advertised rents of 5% outside of London, and 3% in the capital.
A 0.2% quarterly increase in asking rents in the last three months of 2023 was the smallest jump since 2019, indicating that the pace of rent rises is slowing. There have also been signs that more tenants are hitting the limits of what they can pay, with nearly a quarter (23%) of rental properties needing a reduction in advertised rent, compared with 16% a year earlier. Advertised rents in the final quarter of 2023 were, on average, 9.2% higher than a year earlier.
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