London Room Rents Surpass $1,000 as Landlords Exit Market
New renter protections are blamed for shrinking supply and driving up prices in the capital.
The average cost of renting a room in central London has climbed above £1,000, according to data from flatshare platform SpareRoom. This surge occurs months after the implementation of Labour's Renters' Rights Act, which introduced significant tenant protections.
The new legislation, which took effect in May, includes an end to 'no-fault' evictions, limits on rent increases, and a ban on fixed-term tenancies. However, the data indicates that landlords are departing the market in response to these rules, leading to a decrease in the available supply of rooms and a subsequent price hike.
The number of advertised rooms dropped by 7.3% compared to the previous year. The price of a room in inner London rose from £990 in the third quarter of last year to £1,002 in the same period of 2026. Rents in outer London saw a marginal decrease, averaging £800, down from £802.
Matt Hutchinson, a representative from SpareRoom, suggested that some landlords find the investment no longer justifies the compliance efforts required by the new regulations. He told The Telegraph that "affordable housing is supposed to be a political priority, yet the outlook for meaningful improvement is bleak as the Government hasn’t acknowledged these problems."
While rents in inner London had been falling after peaking in 2023, reaching £974 at the start of 2026, they have now crossed the four-figure threshold again. The overall average cost of living in a flatshare across Britain has reached a record high of £769 per month.
Tenants are experiencing the effects firsthand. Laura Meyer, 28, reported difficulty finding an affordable one-bedroom flat in southwest London since the Renters' Rights Act was enacted. She described the current market as the "craziest they have seen in 30 years," citing high listing prices and competitive bidding.
Meyer, currently paying £1,200 a month to share a flat, had hoped to find a one-bedroom flat for around £1,600 but now anticipates needing closer to £2,000.
A Ministry of Housing spokesperson stated that the Renters' Rights Act protects tenants by limiting rent increases to once a year, empowering them to challenge excessive hikes, and prohibiting rental bidding wars. The spokesperson also asserted that the private rented sector has remained broadly stable and there is no evidence of an exodus since the reforms were announced.