Experts argue that double-digit increases are unsustainable because of affordability, but despite this, demand is still high because some landlords are leaving the rental market.
According to Rightmove, which published the index for Britain, each rental property receives an average of 11 inquiries from agents.
There are signs, though, that the market may have peaked, and a slowdown in rent increases is predicted for 2024.
In the final three months of 2023, asking rents increased by 0.2% on a quarterly basis, which was the lowest increase since 2019.
Additionally, there have been indications that an increasing number of tenants are living beyond their means; of rental properties, nearly a quarter (23%) require a decrease in the advertised rent, up from 16% a year earlier.
In comparison to the same period last year, advertised rents in the last quarter of 2023 increased by 9.2% on average.
Even so, Rightmove reported that rent growth was at its lowest level since 2021.
Asking rents in London also reached a record high, averaging £2,631 per month.
This was a 6.1% increase from a year ago and a 0.2% quarterly increase.
According to Rightmove, this was the first time since 2021 that asking rent growth in London had been in the single digits annually.
By the end of 2024, it projects that rents will have increased by 3% in London and 5% outside of the city.
