Date Published 02 October 2026
London's rental market is facing growing pressure, with fewer homes available and more prospective tenants searching for a property, according to Rightmove. The number of homes available to rent in the capital is 10% lower than a year ago, while tenant enquiries have increased by 7%. Studios and one-bedroom properties are seeing the strongest growth in demand, despite average advertised rents of £1,904 per month. This contrasts with the wider picture across Great Britain, where tenant enquiries are 2% below last year's levels and rental availability has increased slightly, by 0.4%.
First-time buyers may be renting for longer
Rightmove's property expert, Colleen Babcock, suggested that some aspiring first-time buyers may be delaying a purchase, contributing to London's recent increase in rental demand. Saving for a deposit and bridging the gap between house prices and earnings remain significant challenges in the capital. As a result, some prospective buyers may be staying in rented accommodation while they build their savings, assess their options or await developments on proposed support schemes, such as the Your First Home initiative.
Babcock stressed that it is too early to establish a direct link, but suggested these factors could help explain why demand for smaller rental homes in London is growing faster than the national average.
Smaller properties lead demand growth
Enquiries for studios and one-bedroom homes in London have risen by 10% year on year, compared with a 4% increase nationally. Demand for two-bedroom properties in the capital has also increased, by 6%, while enquiries for three-bedroom homes are up 2.5%. Nationally, demand for these property sizes has fallen by 4% and 6% respectively.
September marks a shift in demand
Until the end of August, London's tenant demand had averaged around 7% below 2025 levels. However, enquiries moved above the equivalent level last year on 7 September and have remained ahead since. Rightmove measures rental demand through enquiries sent by prospective tenants to letting agents on its platform. The North East is the only other region recording annual growth, with enquiries up 1%. Meanwhile, London's average advertised rent across all property sizes stands at £2,763 per month, an increase of 3.1% year on year. The national average is £1,578 per month, up 2.4%. The figures point to renewed competition for rental homes in London, particularly smaller properties, as demand rises against a backdrop of reduced availability.
With demand rising and fewer homes available, accurate pricing and effective marketing matter more than ever. At Adams Estates, we help landlords position their properties to attract suitable tenants and secure a prompt let. Contact our lettings team for a current rental valuation and advice tailored to your property.
