Shortage of Supply & Growing Demand

Shortage of Supply & Growing Demand

The UK's rental market has seen a significant shift over the past year, with rental values rising across all regions except London. A closer look at these changes reveals a fascinating landscape of supply, demand, and market trends.

Nationwide Growth in Rental Values

  1. A Strong Surge: Excluding London, the average monthly rent in the UK now stands at £853, marking an impressive growth of 6.2% compared to a year ago.
  2. The Power of Supply and Demand: This increase can be attributed to a shortage of supply combined with growing demand, supporting higher rental values. New instructions were found to be 9% lower in the first three months of 2021 than they were in 2020.

The Exception: London

  1. A Different Story: London, in contrast to the rest of the UK, has seen rental values fall by 5.7% year-on-year.
  2. Oversupply Issue: Despite an uptick in rents agreed this year, an oversupply in the market has contributed to the reduction in rental values within the capital.

A Look Ahead

  1. Stable Annual Growth: Across the entire UK, annual growth stands at 2.9%, a rate that aligns with projections for growth over the next year.
  2. A Continuing Trend? With market dynamics continually shifting, the next year promises to be one of keen interest for landlords, tenants, and industry observers alike.


While the rise in rental values across the UK tells a promising story for landlords, London's situation highlights the complexity of market forces at play. The interplay between supply and demand, as well as regional variations, will continue to shape the rental landscape in the months to come. Keeping an eye on these trends will be essential for anyone involved in the UK's vibrant rental market.


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