The latest figure represents a decrease from the 6.7% in the year to June.

This morning, the ONS reported that UK inflation had risen to 3.8% in the year to July, up from 3.6% in June.

Across the nation, average rents increased by 6.7% to £1,398 in England, by 7.9% to £807 in Wales, and by 3.6% to £999 in Scotland, in the 12 months to July.

In Northern Ireland, average rents lifted by 7.4% to £855 in the 12 months to May.

In England, private rents annual inflation was highest in the North East at 8.9% and lowest in Yorkshire and The Humber at 3.5%, in the year to June.

The North East continued to have the highest rent annual inflation rate of all English regions, at 8.9%, in the 12 months to July.

This annual rise was lower than the joint record-high in the 12 months to June at 9.7%.

Rent annual inflation remained lowest in Yorkshire and The Humber, at 3.5%, in the 12 months to July.

This annual rise remained unchanged from in the 12 months to June, following a year of slowing annual inflation.

London’s annual inflation was 6.3% in the 12 months to July, down from 7.3% in the 12 months to June. This was the eighth consecutive month of slowing annual inflation.

Average rent was highest in London at £2,250 and lowest in the North East at £736 in July.

Commenting on the latest figures, Foxton managing director of lettings Gareth Atkins says: “The London lettings market remained red hot in July. Despite a modest uptick in supply, applicant demand surged by 25% month-on-month, resulting in over 18 applicants per available property.”

“This sustained pressure has driven rental prices upward in line with seasonal trends, and we expect this momentum to continue for the rest of the summer.”

Paragon Bank managing director of mortgages Louisa Sedgewick adds: “Continued moderation of private rental growth is a positive sign but monthly payments remain at a level that will stretch many tenants.”

“This is because rent inflation has swelled significantly from 1.0% in the first quarter of 2021 to a record high of 9.0% seen at the end of 2024. This correlates with increased demand seen since the pandemic.”

“It is crucial then that supply matches demand, something that will persist, fuelled by a range of factors including more people living alone or entering higher education, in addition to projected population growth, more broadly.”

“In order to increase PRS stock and slow rent inflation, investment must be financially viable and protected by balanced regulation that considers landlords’ interests as well as tenant rights.”

“Lenders and our industry partners can help by providing a range of finance products to meet landlord needs, but policymakers also have an important part to play if we’re to see a fair and functioning PRS.”

Meanwhile, Hampshire Trust Bank managing director of specialist mortgages and bridging finance Alex Upton adds: “Rents are still edging upwards, but there are signs that tenant demand has eased slightly over the summer.”

“Propertymark’s latest Housing Insight report shows new tenant registrations in June fell to their lowest level in years, and the supply-demand imbalance has softened. There are now six applicants per property on average, compared to nearly ten at points last year.”

“Even so, a modest slowdown doesn’t change the underlying picture. We are still significantly short of the rental stock needed to meet demand, and that structural gap will keep upward pressure on rents for the foreseeable future.”