The supply of new rental properties in the UK has dropped at its sharpest pace since the first Covid lockdown in 2020, according to the latest figures from the Royal Institution of Chartered Surveyors (Rics).
The July 2025 Rics Residential Market Survey reported a “firmly negative trend” in landlords putting properties up for rent, marking the weakest reading in more than five years. While tenant demand remains steady, the shrinking number of available rentals is expected to push prices higher in the coming months.
Rics surveyors forecast that rental prices will rise over the next three months due to the lack of fresh supply. This follows a separate report from estate agency Hamptons, which found that average private rents in Great Britain fell by 0.2% in July compared to the same month last year — the first such drop in five years. Hamptons attributed the fall to lower mortgage rates easing some pressure on the market.
However, Rics also noted a decline in new inquiries from homebuyers in July, reversing the positive trend seen in June. Simon Rubinsohn, chief economist at Rics, said the market remains “particularly price sensitive” despite the Bank of England’s recent fifth interest rate cut in a year, bringing borrowing costs down to 4%.
Uncertainty over further rate cuts, coupled with speculation about the upcoming autumn budget, has added to market caution. The renters’ rights bill, set to come into effect next year, is also influencing landlord behaviour. Tom Bill, head of residential research at Knight Frank, warned that the legislation — aimed at reforming the rental sector — may make it harder for landlords to regain possession of their properties, leading some to sell instead of rent.
Sarah Coles, head of personal finance at Hargreaves Lansdown, said the survey highlights that “the era of runaway rents isn’t over yet,” with more tenants chasing fewer homes. She noted that the average renting household now has just £62 left at the end of the month, underscoring the financial strain many face.
