A new report by Kinleigh Folkard & Hayward (KFH), one of London’s leading lettings and sales agencies, reveals the average London rental price at the end of 2025 was £2,395 per calendar month (pcm) – about 49% higher than the UK average of £1,602 pcm.
Despite sector challenges and regulatory changes, following the landmark Renters’ Rights Act, the report finds that average rents in the Capital increased by 1.5% in 2025, and both the suburban and inner-city markets of London remain stable, demonstrating ongoing confidence from landlords and tenants alike.
Seeing the highest rise in popularity, one- and two-bedroom apartments continue to be the most sought-after types of accommodation amongst renters and prove to be solid investments for landlords with a view to long-term let.
The report also highlights that the supply of property to let in London increased 3% in 2025 when compared to 2024, contradicting the media noise of landlords exiting the market in their masses.
As clarity returns to the sales market and interest rates begin to fall, momentum is building. Since the start of 2026, the market has picked up noticeably, with demand now outpacing supply in many areas. Buyers need to act decisively to secure high-quality properties in prime locations.
Duncan Blakelock, Managing Director, Lettings, KFH, said: “Property in London remains a compelling long-term investment as demand sustains.
“As the report shows, London continues to offer a stable and resilient environment for capital investment. Demand is underpinned by the city’s diverse labour market and a steady influx of graduates and professionals seeking accommodation to rent or buy.”
