Commenting on the latest rental prices, Propertymark chief executive Nathan Emerson said:

“Today’s figures underline the continuing imbalance between tenant demand and the supply of homes available to rent. While figures released today show an easing of inflation compared to the previous month, rents are still moving upwards because supply remains constrained in many local markets.

“Agents on the ground continue to report strong competition for good-quality rental homes, particularly for family properties and homes close to transport links and employment hubs. Many landlords are still weighing up rising costs, taxation and regulation, which is limiting the number of homes coming onto the market.

He added: “What we are seeing is a supply issue rather than excessive demand. Without measures that support investment in the private rented sector, affordability pressures are likely to continue.”

Paragon Bank  managing director of mortgages Louisa Sedgwick said: “Rent inflation has historically tracked wage inflation and we have seen this relationship harmonise in the past year following the severe upwards pressure on rents in the post-Covid era.”

She stressed that the conflict in Iran was building some further inflationary pressure into the economy and that would likely be reflected in the rental market in the coming months.

“Landlords are not immune to cost pressures and 72% of those planning to increase rent in the next year will do so because of the rising costs they face in operating their business, with six in 10 citing a higher tax burden following the 2025 Autumn Budget.

Sedgwick added: “Rising mortgage rates are often claimed to be a driver of rental inflation, but less than 40% of rental properties are mortgaged, with the vast majority of those subject to a fixed-rate mortgage, so the impact of mortgage rates increasing is unlikely to be felt across the broader rental sector.”

Hampshire Trust Bank managing director, specialist mortgages & bridging finance Alex Upton said: “Landlord strategy is continuing to change. We’re having far fewer conversations about expansion for the sake of growth, particularly as the Renters’ Rights Act starts feeding into longer-term investment decisions. Investors are looking much more closely at which properties still work financially, where income is more resilient and how portfolios need to evolve over the next few years.”

“At the smaller end of the market, some landlords are choosing to reduce exposure where higher borrowing costs and tighter regulation have changed the economics of certain properties. More experienced investors are still active, but they are approaching opportunities differently. We’re seeing more interest in HMOs, mixed-use assets and properties where there is genuine scope to strengthen income over time, rather than simply adding units wherever possible.”