Two rates, two directions
Average private rent in the UK reached 1,393 pounds a month in July and rose 3.7 per cent over the year, against 3.3 per cent in June. House prices grew 2.0 per cent in the year to June, down from 3.0 per cent in May. In the ONS estimates the rent measure is at its fastest since December 2025.[1]
The two rates land on different households. Rent is cash leaving a budget every month, while a house price sits on paper until the owner sells or remortgages. A slower price removes no line from a tenant's budget.[1]
A second line in the same budget
In the same July the Ofgem cap update lifted a dual-fuel household's annual bill by 221 pounds to 1,862 pounds, and gas prices rose 14.7 per cent over the month. The CPIH measure, which includes owner-occupier housing costs, reached 3.1 per cent.[2]
The energy bill reaches tenant and owner at the same time, while the rent increase falls on the tenant alone. So the pressure coming from housing in July reaches an owning household through one channel and a renting household through two.[1], [2]
Where you live changes the rate
Average rent in London is 2,317 pounds a month, against 783 pounds in the North East. Annual rent inflation is highest in Wales at 4.5 per cent and lowest in Scotland at 1.7 per cent, with England at 3.8 per cent and Northern Ireland at 2.3 per cent. House prices in the capital fell for a tenth consecutive month, down 2.5 per cent over the year, while the North West gained 4.7 per cent. In the ONS data the most expensive rental market and the fastest-rising one sit in different places.[1]
I set out the same split on the buyer's side on 1 August: falling values do not by themselves raise purchasing power, and the monthly cost of debt decides the difference. July's data show the split on the tenant's side. The measurable signal is this: if London rent growth holds its pace, the rent rate will stay above the house price rate in the next two ONS bulletins, through 31 October.[1], [3]