The average cost of renting a newly let home in the UK is now £3,240 higher than at the end of the pandemic lockdowns, fresh data from Zoopla shows.

Rents have increased by an average of 27% since 2021, the property website found, compared with a 19% increase in earnings, taking the annual cost of renting a property to £15,240, up from £12,000 in 2021.

However, rents are now rising at their slowest level in more than three years, as tenants reach the limits of what they are able to afford to spend on housing.

Rental costs for newly let properties have risen by 3.9% on average over the past year, which is the lowest rate of growth since August 2021.

Rents have been rising more slowly in places with high rental costs, such as London, where they are up 1.3% year-on-year, down from 8.7% growth a year ago.

In contrast, areas with lower rental costs have seen much higher rental growth rates, such as Northern Ireland, where rents are rising by 10.5%, and in the north-east of England, where they are climbing by 8.7%.

Average rental costs in the UK are expected to increase by 4% in 2025, according to Zoopla.

Richard Donnell, the executive director at Zoopla, said: “The number of rented homes hasn’t grown since 2016, creating scarcity for renters at a time when demand has boomed on a strong labour market and the rising cost of home ownership.

“Rental growth has slowed but we expect an ongoing lack of rental supply to keep an upward pressure on rents.”

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