Tenant demand in the rental sector is cooling across Great Britain, as more tenants transition to homeownership, according to Hamptons. The number of tenants registering with lettings branches in May 2025 was down 17% year-on-year, and now sits 28% below 2019 levels.

This marks the 12th consecutive month of declining tenant demand. Over 63% of branches reported fewer tenant registrations in May compared to the same month in 2024.

The decline is largely driven by improving mortgage affordability. For those with at least a 10% deposit, the monthly cost of buying is now typically lower than renting — a reversal that’s prompting many would-be tenants to buy instead.

This trend is most pronounced in affluent areas, where tenant demand has fallen 50% more than in less affluent locations.

Key figures:

• So far in 2025, there have been 1.5 tenants registering per first-time buyer, down from 5.9 in 2017.

• In both London and Scotland, first-time buyer demand now exceeds tenant demand for the first time in over a decade.

• In London, 50.3% of new buyer registrations this year were first-time buyers — up 2% year-on-year.

Despite a slowdown in new buy-to-let purchases, the number of homes available to rent rose 5% year-on-year at the end of May 2025. Rental stock has increased every month since August 2022, though recent monthly gains are now in the low single digits, reflecting longer letting times due to softer demand.