London landlords have maintained consistent rental growth rates following the introduction of the Renters’ Rights Act, according to new data from Benham and Reeves.
Rents in the capital increased by just 0.7% in the five months following Royal Assent in October 2024, matching the rate of growth during the equivalent period prior to the legislation becoming law.
Market fundamentals prevail
The figures challenge concerns that landlords would use the new regulatory framework as justification for significant rent increases. Marc von Grundherr, Director at Benham and Reeves, stated: “One of the key concerns surrounding the Renters’ Rights Act was that landlords would look to offset the additional regulatory burden by increasing rents, but the data suggests this simply hasn’t happened across London.”
He added that rental values continue to be driven by local market fundamentals, particularly the balance between supply and tenant demand, rather than legislative change alone. This pattern reflects broader regional divergence in property market performance across the UK.
Borough-level variations
The data reveals that 18 of London’s 32 boroughs experienced a slowdown in rental growth following the Act’s implementation. Kingston-upon-Thames recorded the largest reduction, with rents rising 2.9% in the five months to October 2024, then falling 1.9% in the subsequent period.
Brent showed the most significant reversal, with rents falling 5.2% before the legislation, then increasing 2.2% afterwards, representing a 7.4 percentage point swing.
As the property sector continues to navigate increased legal complexity, the rental market appears to have absorbed the regulatory changes without the anticipated rent spike.
National context
Separate research from Inventory Base last month indicated that only approximately 25% of landlords nationally attempted to front-load rent increases ahead of the 1 May deadline, suggesting the feared spike in rents ahead of the Act did not materialise across the country.
The stability in London’s rental growth rates suggests landlords are responding to market conditions rather than using legislative changes as a basis for pricing decisions, with supply-demand dynamics remaining the primary driver of rental values.