The number of sitting tenants seeing their rent increase fell sharply in the first month of the Renters’ Rights Act, prompting suggestions that landlords may be moving towards less frequent – but larger – rent rises.
Analysis by Hamptons, using Connells Group data, found the number of existing tenants whose rent increased in May was 23% lower than in May 2025 and 16% below the five-year average for the month.
The figures come after the Renters’ Rights Act came into force on 1 May, replacing most fixed-term tenancies in England with periodic agreements and limiting landlords to one rent increase per year.
If the pattern recorded in May continued throughout the year, Hamptons estimates that 31% of sitting tenants would experience a rent rise, down from 40% over the 12 months to May 2025 and well below the 50% recorded in early 2024.
SIZEABLE RENT RISES
However, while fewer tenants are seeing their rent increase, those who do are still facing sizeable rises.
The average increase among tenants whose rent changed in May was 5.4%, unchanged from April and only marginally below the 5.5% recorded a year earlier.
The experience in Scotland, where periodic tenancies have been in place since 2017, suggests the trend could continue. Scottish tenants who saw their rent change experienced an average increase of 7.7% in May, the highest level of any region in Great Britain.
Meanwhile, rental growth for new lets remains subdued. The average rent on a newly agreed tenancy across Great Britain rose by 1.1% year-on-year to £1,382 per month, while rents in the South East reached £1,500 per month for the first time.
SLOWER RENTAL GROWTH
Aneisha Beveridge (main picture, inset), Head of Research at Hamptons, says: “One of the first impacts of the Renters’ Rights Act has been a reduction in the number of existing tenants seeing their rent rise.
“While this partly reflects a backdrop of slower rental growth, falls suggests landlords have, at least initially, been less likely to increase rents than under the previous system where changes predominantly coincided with a tenant signing a new contract.
“If the pattern seen in Scotland plays out in England, tenants may see their rent rise less often going forward.”
CAUTIOUS APPROACH
She adds: “However, the size of the increase may be larger, bridging the gap that can build up between what tenants are currently paying and the prevailing market rate. Last month, the average rent increase in Scotland was 7.7%, higher than in any other region in Great Britain.
“While rental growth on newly agreed lets remains cool by recent standards, landlords appear to be taking a more cautious approach when selecting new tenants.
“Many are showing a willingness to wait for the right tenant rather than accept the first offer, which has reduced the number of homes let and helped to keep a lid on rental growth for new tenants.”
