South London Lettings Market Update: July 2026

With all the turmoil, all the talk of landlords exiting the market in their droves, with Renters’ Rights Act implementation in stages, and with other changes to legislation that governs the sector going through and coming down the tracks, you could all be forgiven for thinking that we are experiencing a lettings market on its knees.

But it’s not what we’re seeing.

If you're a landlord in South London, the market across this part of the capital has had a genuinely strong 12 months, and the most recent monthly figures suggest that momentum is showing no signs of slowing down.

Rents are still climbing, and the pace is picking up

Average achieved rents across Southwest London have risen by 8.83% over the past year. That's not a one-off spike. Look at the month-by-month trend and you can see growth building steadily: annual rental growth stood at 2.36% back in July last year, and has climbed almost every single month since, hitting 8.80% by June 2026.

Houses have outpaced flats. Rents on houses are up 11.03% year-on-year, against 7.45% for flats. If you own a house rather than a flat in this part of London, your asset has worked harder for you this year.

If we do break it down by property type, the picture is consistent. Detached homes command the highest average rent locally at £2,902 a month, ahead of semi-detached (£2,701) and terraced (£2,523) properties. Flats sit at £1,988 on average.

Bigger is actually performing better right now

The standout performers over the past year have been larger rented homes. 4+ bedroom houses have seen average rents jump 14.33% to £2,920 a month. Three-bedroom flats aren't far behind, up 13.47% to £2,374. At the other end of the scale, studios have barely moved; up just 0.91% to £1,428.

Family-sized homes has been where the growth is. Tenants are paying a premium for space, and that premium has grown noticeably over the past year. But our message for landlords of smaller properties is not to worry; the picture is not always this way. Smaller properties often do better, with stronger rent growth and better yields compared to average property value.

Availability is rising

Here's a stat that could easily be misread: the annual change in the availability of rental homes has grown sharply, from 17.55% back in July 2025 to over 76% by June 2026.

On the surface, more property available sounds like it should soften rents. But that hasn't happened; rents have kept climbing right alongside it.

What this tells us is that demand has simply absorbed the extra supply.

More landlords bringing property to market is a healthy sign of a functioning rental sector, not a red flag for rental values. If anything, it points to a market with enough underlying tenant demand to keep pace with, and outstrip, a fast-growing pool of available homes.

Who's renting, and what they're renting

Two-bedroom flats remain the bread and butter of the local lettings market, accounting for nearly 31% of all new rentals in the past year, broadly in line with the Greater London average. One-bedroom flats make up a further 24%, and three-or-more-bedroom flats 21%, notably higher than London as a whole (18.25%), reflecting the more spacious housing stock across this part of the city.

Houses are a smaller slice of the market by volume, but 4+ bedroom houses punch above their weight at nearly 11% of lettings; again, well ahead of the London-wide figure of 7.7%.

The people renting these homes reflect the area's character. The local population of southwest London sits at just under 890,000, with the largest age group being 25 to 34-year-olds. That is precisely the cohort you'd expect to be renting rather than buying at this stage of life in the capital city.

Average renter income locally is now £47,075, and over a third of households (34.6%) are families with children, which helps explain why demand for larger homes and houses has been so resilient.

Tenure-wise, 33% of local residents live in private rented accommodation, 21% in social housing, and 46.4% are owner-occupiers, with 117,908 rented households across 358,667 dwellings in the area. With 48.32% of residents working from home, it's little surprise that space continues to command a premium; when the spare room doubles as an office, tenants are clearly willing to pay for it.

The bottom line for landlords

There's little in this data to support the pessimism that sometimes creeps into rental market commentary. Rents are up, growth is accelerating rather than plateauing, and rising availability hasn't dented values; quite the opposite. If you own a family-sized house or a larger flat in Southwest London, the past year has been a strong one, and the trend lines suggest there's more to come.

If you'd like a free, no-obligation rental valuation to see how your property compares, get in touch with the Your Home Managed team today.

Source: Dataloft Rental Market Analytics by PriceHubble. Rental change figures calculated on a price-per-square-foot basis over a 12-month period.