Rents in the UK increased by an average annual rate of 1.1% during July, new data from HomeLet reveals, a return to positive inflation following two successive months in which rents fell. The average rent agreed on a new tenancy signed during July was £925 according to the July HomeLet Rental Index, compared to £915 in the same month of 2016.

July’s 1.1% annual increase compares to declines of 0.3% and 0.2% in May and June respectively, the first time rents had fallen in the UK since 2009. Nevertheless, inflation in the private rental sector continues to lag the general rate of inflation, which was 2.7% in June, the latest month for which official data is available.

The Greater London rental property market continues to act as a brake on the UK as a whole, with rental inflation in the capital now running at -0.6% a year. July was the fourth successive month in which London saw rents fall, and while the pace of decline is now slowing – July’s figure compares to a 2.9% drop in June – the capital’s rental market still looks transformed compared to this time last year, when rents were rising at an annual rate of 6.6%.