New data has revealed the growing pressures facing households deciding between renting and buying in 2025.
The latest housing index data from the Office of National Statistics which has been analysed by insurance broker SJL, reveals that in the 12 months to August 2025, the average UK monthly private rent rose to £1,348, a 5.7% annual increase.
Rents in England averaged £1,403 per month (5.8%), while Wales saw the fastest rise at 7.8%, with average rents reaching £811. Scotland recorded a more modest 3.5% increase to £1,002.
By contrast, house prices are rising slower. The average UK house price in July 2025 was £270,000, up 2.8% year-on-year. In England, the figure was £292,000 (+2.7%), in Wales £209,000 (+2.0%), and in Scotland £192,000 (+3.3%).
What This Means for Households
Rising rents are taking up a larger share of household budgets, leaving less room for savings or deposits. Buyers, meanwhile, face high mortgage costs and deposit requirements, despite slower house price growth.
Insurance, however, is an often-overlooked part of the equation. Craig Morgan, insurance expert at SJL Insurance Services, warns that whether renting or buying, households need the right cover to avoid major losses.
“Whether you’re renting or buying, a single incident such as a fire or flood can wipe out years of hard work. Insurance isn’t the first thing people think about when they’re budgeting, but it can be the difference between recovering quickly and facing a financial crisis,”
Craig then went on to share his top tips for renters and homeowners:
For Renters
- Take out contents insurance to protect possessions such as electronics, clothing, and furniture against theft, fire, or water damage.
Even if your landlord insures the building itself, your personal belongings won’t usually be covered without your own policy.
- Consider liability cover if you accidentally damage the landlord’s property or a neighbour’s belongings.
This type of cover can prevent small accidents from turning into costly repair bills.
- Review your policy carefully by checking coverage limits, excess, and whether items are insured away from home.
Policies vary widely, so it’s important to know exactly what is and isn’t included before you need to claim.
For Homeowners with a Mortgage
- Ensure you have buildings insurance to cover the property’s structure, including walls, roof, and fixtures.
Most lenders require this as a condition of the mortgage, but it’s also your safety net against major damage.
- Pair this with contents insurance to protect valuables inside.
From jewellery to laptops, replacing lost or stolen items can quickly add up without cover.
- Consider mortgage protection insurance to safeguard repayments in case of illness, injury, or job loss.
This can help keep you in your home even if your income is temporarily disrupted.
- If you live in a flood or subsidence risk area, check your policy for natural hazard cover.
Standard insurance may exclude certain risks, so specialist cover may be needed in high-risk postcodes.
- Review your cover after renovations or large purchases.
Home improvements or new high-value items can leave you under-insured if your policy isn’t updated.
For Outright Homeowners
- Buildings and contents insurance remain vital even if a lender doesn’t require them.
Without cover, you’d be solely responsible for repairing damage or replacing belongings.
- Check your policy covers liability and accidents on your property.
For example, if a visitor is injured, liability cover can protect you against legal and compensation costs.
- If renting out part of your home (e.g. through Airbnb), ensure you’re covered for short-term lets.
Standard home insurance often excludes paying guests, so specialist or add-on cover may be necessary.
