Rental demand is gathering pace again after a relatively subdued period, with agents around the UK reporting the strongest increase in prospective tenants for more than a year.

The Royal Institution of Chartered Surveyors’ (RICS) June survey found a headline net balance of +18%, suggesting the rental market is beginning to tighten once more. However, it remains relatively subdued by the standards of recent years.

Meanwhile, the new landlord instructions indicator slightly improved, coming in at -18% from -28% previously. Against this imbalance, near-term rental price expectations remain consistent, says the RICS, with projected rental growth in the next 12 months standing at about 2.5%.

Neil Foster at Hexham-based Walhouse Surveyors & Valuers reports that for the first time in nearly four years his agency has noticed properties advertised with ‘reduced’ rent. “The structural deficit of stock remains but price growth has definitely eased,” says Foster.

Number

London-based Jeremy Leaf says a significant number of landlords have sold their properties – often flats – due to increasing tax and the Renters’ Rights Act regulatory responsibilities. “As a result, there’s plenty of choice which is putting a dampener on rents.”

The buy-to-let market strengthened last month compared with May, reports Twenty7tec, which reports that some investors are still looking to make purchases.

Its latest Mortgage Market Snapshot showed total buy-to-let searches increased 9% to 275,284, while buy-to-let purchase and remortgage searches were also up by 9%. However, it’s a more mixed picture when comparing figures with the previous year, as total buy-to-let searches were 5% lower than June 2025 and buy-to-let purchase searches fell 14%, suggesting investor activity remains more subdued than the owner-occupier market.

Conditions

Conditions have improved during the second quarter of the year, allowing lenders to begin reducing rates and reintroducing products withdrawn during the earlier volatility due to the conflict in Iran and rising swap rates, according to Fleet Mortgages.

The firm believes this improving lending environment is likely to support landlord confidence during the second half of the year. Chief commercial officer Steve Cox explains that as markets can change quickly, landlords should continue to expect periods of volatility. “The important point is the fundamentals of the private rented sector remain strong and those taking a long-term approach should continue to find attractive opportunities across the market,” he adds.

‍