How to Budget for Rising Rent Ahead of Your Renewal Date

Rent renewal notices routinely arrive with an increase, and current UK rental data shows why - rents have been rising faster than general inflation for an extended period. Here’s the current picture and how to budget ahead of your own renewal.

Where rents actually stand

Average UK private rents rose 3.3% in the 12 months to May 2026, reaching £1,383 a month - a slower pace than the double-digit rises seen in 2023 and 2024, but still comfortably outpacing UK CPI inflation of 2.8% over the same period. Regional variation is significant: rents in the North East rose 5.9% annually, while London rose just 2.0% - a reversal of the pattern seen a couple of years ago, when London led rental growth after the pandemic.

Why growth has slowed, but not stopped

Rental growth has cooled from a peak of around 9% in early 2024 to the current 3–3.5% range, reflecting tenants reaching the limit of what they can afford without matching wage growth. Some individual cities have seen rents fall slightly (Birmingham, Nottingham, and Bournemouth were reported as small exceptions in mid-2026 data), while others - often smaller towns with historically lower rents - continue to see sharper rises as they catch up from a lower base.

Budgeting ahead of your specific renewal

• Check the current average annual growth rate for your specific region, not just the national figure, since the gap between the fastest and slowest-growing regions is currently several percentage points.
• Ask your landlord or agent in advance what increase to expect, rather than waiting for the renewal notice - many landlords are willing to discuss the figure ahead of the formal renewal date.
• Build the likely increase into your budget before it’s confirmed, using the current regional average as a starting estimate, so a below-average final figure feels like good news rather than the average increase feeling like an unplanned shock.

If the proposed increase feels excessive

• Compare the proposed rent to similar local properties currently advertised, since this is the most concrete evidence for a negotiation conversation with your landlord.
• Check your tenancy type and notice requirements - rules on how and when rent increases can be implemented vary depending on your specific tenancy agreement.
• Consider the cost and disruption of moving against the proposed increase - moving itself carries costs (deposits, removal costs, potential gaps between tenancies) that should factor into whether staying and negotiating, or moving, is genuinely the better financial choice.

Why rent increases interact with your wider budget

Since housing is typically the largest single line in most household budgets (see our dedicated article on how much of your income should go on housing), even a modest percentage rent increase can represent a meaningful absolute amount - worth reviewing your entire budget, not just accepting the new figure and cutting elsewhere reactively without a clear plan, particularly alongside other costs that change on their own quarterly schedule, like energy under Ofgem’s price cap.

The bottom line

Rent increases are currently running at a slower pace nationally than a couple of years ago, but still outpacing general inflation, with considerable regional variation. Checking your specific area’s current growth rate ahead of your renewal date - rather than being surprised by the notice itself - gives you a much stronger position to budget for, or negotiate, the actual figure.