2025 Predictions for the Private Rental Sector

Allison Thompson, National Lettings Managing Director, Leaders Romans Group (LRG)

“As we approach 2025, the lettings industry is entering a phase marked by stabilisation and opportunity. Rental inflation has slowed to an average of 3-4% for new lets, reflecting the effects of affordability constraints; renters’ budgets are beginning to limit how much rents can rise. Despite this moderation, high demand persists, especially in regions with limited rental stock, positioning landlords with well-maintained properties to benefit from stable rental yields.

“Supply remains constrained, with data showing that around 12% of current property sales are from landlord disposals, yet this is a controlled exit, not a mass exodus. Many landlords are seizing the chance to adapt, whether by modernising properties to meet growing tenant interest in energy-efficient homes or adjusting portfolios in line with potential new energy regulations. This gradual shift aligns with tenants’ increasing prioritisation of sustainable housing, setting up an environment where landlords who invest strategically may gain a competitive edge.

“Mortgage rates, which now stabilise in the low 4% range, have shown signs of easing affordability pressures on homebuyers. As a result, there may be a gradual uplift in first-time buyer numbers, potentially softening rental demand in the long term. However, the Private Rented Sector (PRS) remains indispensable, providing accessible housing for those not yet ready to buy and ensuring continued demand for rental properties across the UK.

“The anticipated Renters’ Rights Bill (RRB) introduces an element of uncertainty for the coming year, but its impact will likely unfold progressively as its specifics become clearer. Meanwhile, energy performance standards are a focus for many landlords, with the possibility of requiring EPC ratings of ‘C’ or above. Although these changes are not due to come into effect until 2030, Landlords will be considering how these changes affect their plans over the interim period. While these changes are intended to improve housing standards, we do need to consider the impact they could have on the sector over the long term.”

EAN Breaking News

Breaking News from the team at Estate Agent Networking. Have a new story to share with us? Then please get in contact today! When and where we can we will refer to third party websites with a 'live link back' where news was released first.

You May Also Enjoy

Home and Living

Kitchen Trade Expert Shares Five Benefits of Fully Assembled Units

The UK kitchen and bedroom fitting sector is currently facing a number of challenges. The UK Trade Skills Index 2023 report revealed that 937,000 new workers will be needed in the construction and trade industries by 2032 to meet the demands of the sector, impacted by the widening skills loss posed by Brexit, an ageing…
Read More
Breaking News

Why are HMO numbers falling?

The latest research from COHO, the HMO management platform, reveals that despite little change in tenant demand, house share availability has dropped by almost -60% in some parts of England, raising the question of whether we’re seeing an HMO landlord exodus. COHO’s analysis of house share listings data* shows that in England, the number of…
Read More
Breaking News

Only 27% of homes have been fixed in a £1.8bn Govt programme

Report shows only 27% of homes have been fixed in a £1.8bn Govt programme, as red tape and asbestos keep thousands in the cold Thousands of homes will face another winter of fuel poverty due to a raft of failures as scheme to fix them hits buffers Hundreds of millions of pounds of allocated grant…
Read More
Breaking News

UK House Price Index for July 2025

The latest index shows that: – The average monthly rate of house price growth in July was +0.3%. The average annual rate of house price growth in July was +2.8%, down slightly from +3.6% in June. As a result, the average UK house price sits at £269,735.   Director of Benham and Reeves, Marc von…
Read More
Breaking News

ONS House Price Index – Thoughts from the Industry

Thoughts from the Industry about the latest ONS House Price Index. Nathan Emerson, CEO of Propertymark: “It is positive to see the housing market progressing forward in strength. As we move towards the autumn months, hopefully this momentum will continue. “There continues to be two factors that may weigh heavily on consumers’ minds as they…
Read More
Overseas Property

European capitals hold £76bn worth of property potential

The latest market insight from international property consultancy, Astons, reveals that across seven major European capital cities for property investment activity, the current market holds £75.8bn worth of opportunities. Astons has analysed the current property markets in seven major European capital cities* to see which have the most residential listings and therefore offer the greatest…
Read More