Knight Frank has edged up its rent increase forecast to reflect the uncertainty surrounding the Renters Rights Bill.

It says the change is small but reflects the risk that supply may become more constrained due to legislation that tips the balance of power in favour of tenants.

The agency adds that a number of landlords have already sold due to a succession of tax and legislative changes in recent years, so it is not expecting a further material drop in supply.

However, it has revised up forecasts for prime central and outer London. In both Prime Central London and Prime Outer London is expects growth of 3.5% in 2025 rising to 4% in 2027 (up from figures of 3% and 3.5% in August).

Meanwhile, its mainstream rental forecasts are largely unchanged.

The agency says: “We believe slowing wage growth will increase affordability pressures for tenants, which means rental value growth is expected to calm down from the heights of the pandemic, a period that was also distorted by a lack of supply.

“Rightmove data shows that new UK rental listings are still a fifth below pre-pandemic levels and, combined with the uncertainty of the Renters Rights Bill, we expect mainstream rental value growth between 2025 and 2029 (17.6% in the UK) that is still marginally higher than the historical norm.”