Cooling Sales and a Heated Budget Ahead: UK Rental Market Update (20 November 2025)

Summary:

The second half of November brings below zero temperatures and rising apprehension ahead of the delayed Autumn Budget this year. This week's rental market update highlights greater compliance risk for landlords amid tighter enforcement tools and expanded rent repayment orders in the Renters' Rights Act. This has the effect of making professional management and accurate record-keeping more important than ever. Slowing sales but sustained rental demand suggest continued pressure on affordability, while upcoming planning and short-let tax changes may shift supply across the private rented sector. In light of AI rapidly transforming agency operations, those who adopt smarter, more efficient workflows early will be best placed to stay compliant and competitive in the current and future legislative environment.

The Top Headlines:

1. Rent enforcement tools strengthened ahead of Renters’ Rights Act rollout
   The government has published updated guidance for councils on rent repayment orders. Under the new Act, tenants and local authorities can reclaim up to two years’ rent where landlords commit specified offences. Industry commentators note that the Act will increase the use of rent repayment orders and other sanctions, whereas, some question whether councils will be able to properly enforce the new rules due to under-resourcing and lack of training.
   Source 1, Source 2
2. Average first-time buyer in London now paying around £500,000
   New UK Finance figures show the average first-time buyer price in London is close to £500,000, up from £398,000 in 2015. Typical buyers are putting down deposits of about £138,000 on combined household incomes just over £100,000. The Times highlights growing reliance on parental gifts and years of saving while renting, which is locking out many potential owners. Source
3. London house prices fall to lowest level in nearly two years
   ONS data show average London house prices down 1.8% year-on-year in September 2025. This is down to £549,942, the lowest since December 2023, even as UK prices overall rose 2.6%. Steep falls are recorded in high-value areas such as the City of London (-15%) and Kensington & Chelsea (-11.3%). The weaker buyer demand is connected to stretched affordability, elevated mortgage rates, and the anticipation of looming tax rises on expensive homes in next week’s Budget. Source
4. Experts warn fast-track approvals near train stations could undermine planning decisions
   Steve Reed's proposals would see housing schemes within a 15-minute walk of rail stations receive a 'default yes' if they meet certain rules. However, industry experts caution that fast-tracking developments could undermine local consultation, and reduce the quality or viability of schemes. With concerns over the generic approvals lacking specialism to the needs of particular neighbourhoods, potentially increasing delivery risk and public backlash. Source
5. Latest ONS data: house prices slow, rents still rising but cooling
   New figures reported this week show UK house prices up 2.6% year-on-year in September, the smallest rise since May. At the same time, average private rents rose 5.0% in the 12 months to October, down from 5.5% in September, and the slowest rent growth in over three years. This comes alongside inflation easing to 3.6% in October, ahead of the looming Budget. Source
6. Tax on Airbnb-style rentals to feature in upcoming Budget
   According to media reports, the forthcoming Budget will include proposals to introduce a 'tourism tax' on short-term rentals, such as Airbnb's and other holiday rentals. The government is considering giving local mayors powers to impose a nightly levy on overnight stays. However, the hospitality sector warns of inflationary impacts and possible deterrents to domestic tourism. Source
7. Speakers for The Negotiator Show announced - LightWork AI’s co-founder Rameen Sorkhabi set to speak
   The Negotiator Conference & Expo, one of the flagship events in the residential agency calendar, has announced its 2025 speakers, featuring leading voices from across property, tech and agency. Among the line-up is Rameen Sorkhabi, co-founder of LightWork AI, who will join the expert panel discussion: “AI – How is it shaping agency and what will the near future look like?”. The session will explore how artificial intelligence is transforming agency operations, from automation and compliance to marketing, data and client service, and what agents need to prepare for in the years ahead. Source

Landlords and agents: Stronger enforcement and new rent rules mean higher compliance risk for landlords. Similarly, property sales and high rents are maintaining supply pressures on the private rented sector. With planning changes and short-let taxes on the way, and AI reshaping agency operations, those who modernise and stay compliant will stay competitive and be best prepared for the Renters' Rights Act and the Autumn Budget.