## UK Private Rents Rise by 3.5% in Early 2026

The latest data from the Office for National Statistics reveals that average monthly private rents in the UK rose by 3.5% to £1,367 in the 12 months leading up to January 2026. This marks a slight slowdown from the 4% annual increase recorded in the previous month, indicating a gradual easing in rental inflation.

Regionally, England saw average rents increase by 3% to £1,423, with Wales experiencing the strongest growth at 5.8%, pushing average rents to £826. Scotland’s rental market recorded a more modest rise of 2.6%, with average rents reaching £1,021. Northern Ireland also saw a significant increase of 5.6%, taking average monthly rents to £875.

Within England, the North East led rental inflation with an 8% annual increase, while London recorded the slowest growth at just 1.1%. This regional variation highlights differing supply and demand pressures across the UK.

## House Price Growth Shows Signs of Moderation

Alongside the slowing rental growth, house price inflation also moderated in the year to December 2025. Average UK house prices increased by 2.4% to £270,000, down from 2.8% growth the previous month. London experienced a decline in house prices, falling by 1.2% over the year.

In England, average property values rose by 1.7% to £292,000, a softer increase compared to the 2.5% growth recorded in November 2025. Wales and Scotland posted stronger annual gains of 5% and 4.9%, respectively, with average prices reaching £215,000 and £191,000. Northern Ireland recorded the highest growth among UK nations, with prices rising 7.5% to £196,000.

## What This Means for Landlords and Letting Agents

The continued rise in private rents, albeit at a slower pace, suggests that demand remains robust across much of the UK’s rental market. However, the moderation in both rental and house price growth may reflect emerging market uncertainties and shifting economic conditions.

Tom Bill, head of UK residential research at Knight Frank, highlighted ongoing concerns for landlords: “Although rents are drifting lower from the highs of the pandemic, red tape and tax are still a concern for landlords. The introduction of the Renters’ Rights Act this May adds extra layers of uncertainty around the setting of rents, repossession rules and the ability to sell. In many areas of London, we are seeing rents pushed higher as landlords attempt to sell and supply is squeezed.”

Nathan Emerson, CEO of Propertymark, noted that while slower rent growth may offer some relief to tenants, it is also influenced by localised demand and supply changes. He emphasised the importance of policies that encourage investment and maintain adequate rental stock to ensure sector stability.

Richard Donnell, executive director at Zoopla, attributed the slowing rental growth to increased supply and weaker demand, partly due to reduced migration and improved mortgage availability for first-time buyers. He observed that renters now have more choice than in recent years, though rents are not expected to fall.

Alex Upton, managing director of specialist mortgages at Hampshire Trust Bank, pointed out that despite moderated rental growth, supply and demand imbalances persist. “Tenant demand continues to outstrip available stock, and landlord confidence is under pressure. In a market this finely balanced, even a modest reduction in supply can translate quickly into renewed upward pressure on rents.”

## Implications for the Private Rented Sector

For landlords and letting agents, these trends suggest a cautiously optimistic outlook. While rental growth is slowing, the underlying demand and supply imbalance remains a key factor supporting rent levels. The introduction of new legislation, such as the Renters’ Rights Act, will require landlords to stay informed and adapt to evolving regulatory requirements.

The regional disparities in rental and house price growth also underline the importance of local market knowledge when setting rents or considering property investments. Areas like the North East and parts of Wales and Northern Ireland may offer stronger rental growth prospects compared to London and some southern regions.

Suggested internal link anchors
– private rents
– rental inflation
– Renters’ Rights Act
– tenant demand
– landlord confidence
– house price growth
– regional rental markets
– rental supply and demand
– property investment
– letting agents
– UK rental market trends
– residential property legislation

TLA update

TLA is launching a new Trusted Partners Hub in Q1 2026, featuring verified and approved service providers selected to support landlords, tenants, and property management businesses. We are inviting legal, trades, insurance, financial, mortgage, tenant screening, and other service providers to register their interest here: https://landlordassociation.org.uk/become-a-tla-service-partner/