Rental growth has outpaced house price growth in 26 of London’s 32 boroughs since the start of the year, according to research by Benham and Reeves. Rents have kept climbing while property prices weakened across much of the capital.
The agent compared the average monthly rate of house price growth in each borough with average monthly private rental growth between January and July 2026, the latest period available.
London rents rising while house prices fall
Across London as a whole, average house prices fell 0.10% a month, while average private rents rose 0.47% a month. Of the 26 boroughs where rents outperformed, 23 recorded positive rental growth that beat either falling or more modest house price growth.
Camden had the strongest rental growth at 1.16% a month, against a 0.13% monthly fall in house prices. Islington recorded rental growth of 0.85% a month as prices fell 0.43%. Rents in Brent and in Hammersmith and Fulham both rose 0.67% a month, compared with house price falls of 0.18% and 0.20% respectively.
Rents hold up better where they have fallen
Three further boroughs saw average rents decline, but at a considerably slower rate than house prices. Westminster recorded the largest monthly house price fall at 1.27%, while rents slipped just 0.01%. In Kensington and Chelsea, prices fell an average of 1.06% a month against a 0.05% fall in rents, and Lambeth rents dipped 0.01% a month as prices fell 0.27%.
Six boroughs see house prices outperform rents
House prices beat rental growth in six boroughs, all of which recorded positive monthly price rises. Barking and Dagenham led, with prices up 0.82% a month against rental growth of 0.15%. Kingston upon Thames saw prices rise 0.71% a month while rents fell 0.13%, and Barnet recorded price growth of 0.48% against rental growth of 0.19%.
Ealing (0.32% versus 0.27%), Bexley (0.18% versus a 0.05% rental fall) and Havering (0.04% versus 0.03%) made up the remaining three.
“London’s sales market has faced a challenging year, with house prices cooling across many boroughs as buyer demand has remained subdued,” said Marc von Grundherr, director of Benham and Reeves.
“In contrast, the rental market has largely gone from strength to strength, underpinned by the fundamentals of high tenant demand and limited available stock. This is particularly welcome news for London’s landlords, who have endured a turbulent year as they navigate the implementation of the Renters’ Rights Act and the additional pressures it brings.
“While the legislation has undoubtedly created new challenges, it’s important not to lose sight of the strength of the underlying rental market. Rents continue to outperform house prices across the vast majority of London, demonstrating that demand for rental accommodation remains robust despite the wider challenges facing the property sector.
“For landlords, property investment remains a worthwhile long-term proposition. Capital appreciation is only one part of the equation and, with rental income continuing to strengthen, buy-to-let remains an attractive investment option for those prepared to adapt to the changing landscape.”
