The pace of rental growth has fallen back to just a third of the wider inflation rate, according to fresh figures from Hamptons.

Over the 12 months to February 2025, the average cost of a newly agreed let in Britain rose by just 1.0%, the slowest rate since September 2020 when rents started returning to growth after falling at the start of the Covid pandemic.

The pace of rental growth nationally has been dragged down by London, where newly agreed rents were down 2.8% on the same time last year.

These falls put the cost of moving into a new rental property in the capital back to May 2023 levels.  

Newly agreed Inner London rents fell by 5.1% over the last 12 months, meaning they stand 9.4% below their peak last year.

The falling cost of rents on new lets across Inner London means that increasingly, tenants can find themselves better off moving home than renewing a contract for their existing home.  

Here, the average monthly cost of moving into a new home stood at £2,647pcm, 3.5% less than the cost faced by tenants renewing a contract with an existing landlord.

Nationally, while the cost of renewing a contract continued to rise faster than the cost of moving into a new property, tenants staying put still paid less.  

The average rent on contract renewal rose 5.6% over the last 12 months, meaning the average renewal rent is £93 pcm below the cost of moving into a new property.