Liaison contacts suggest that firms have also been able to limit cost inflation by switching to lower-cost building materials. Graph 9  Rents The pace of rent inflation has been falling since 2008, and year-ended rent inflation is around its lowest level since the mid 1990s.
This has been a considerable drag on inflation: rental inflation was nearly 3 percentage points lower per annum in the past three years than in the previous twenty, which has reduced aggregate inflation by nearly 0.2 percentage points per annum in recent years. The decline in rent inflation can be attributed to a mix of supply and demand side developments.