## UK Rent Increases Moderate but Remain Positive

New data from the Office for National Statistics (ONS) shows that private rents across the UK continued to rise throughout 2025, though the rate of increase slowed towards the end of the year. Average monthly rents climbed by 4% over the year to December, reaching £1,368, down slightly from 4.4% growth recorded in the previous month.

Regionally, England saw typical rents rise by 3.9% to £1,424. Wales experienced sharper rental growth, with a 5.7% increase taking average rents to £822. Scotland’s rental market showed more modest growth of 2.8%, with average rents at £1,018. Northern Ireland mirrored Wales with a 5.7% rise to £873 in the year to October.

Within England, the North East recorded the strongest annual rental increase at 7.9%, whereas London’s rent growth slowed significantly to 2.1%. This regional variation highlights differing market dynamics, with some areas experiencing more intense rental demand pressures than others.

## House Prices Continue Upward Trend

Alongside rental figures, the ONS reported that average UK house prices rose by 2.5% in the year to November, pushing the typical price to £271,000. This marks an acceleration from the 1.9% annual growth seen a month earlier.

Breaking down by nation, England’s average house price reached £293,000, up 2.2% or approximately £6,000 over 12 months. Wales lagged behind with a modest 0.7% increase to £209,000. Scotland outperformed both, recording 4.5% growth to £193,000. Northern Ireland led the UK with a 7.1% annual rise, lifting average prices by £13,000 to £193,000.

## What This Means for Landlords and Letting Agents

The slowing pace of rental growth suggests some easing of pressure on tenants, but the continued upward trend in both rents and house prices indicates that demand remains robust and supply constrained. Alex Upton, Managing Director of Specialist Mortgages at Hampshire Trust Bank, commented: “While the latest ONS data shows a slowdown in rental growth, the underlying pressure has not gone away. Demand remains strong, supply is still tight, and that imbalance continues to feed through into pricing.”

Richard Donnell, Executive Director at Zoopla, noted that rental inflation is slowing as the supply-demand gap narrows. He attributed this to improved affordability for first-time buyers and a significant drop in international migration, which has weakened rental demand. Additionally, a 14% increase in homes available to rent compared to the previous year is providing more choice for renters. Donnell forecasts rental inflation to slow further to around 2.5% in 2026, the lowest rate in four years.

However, Nathan Emerson, CEO of Propertymark, emphasised ongoing challenges: “Although we have witnessed rental inflation trend further downwards, the rental market continues to suffer from a chronic undersupply of properties versus actual demand.” This persistent imbalance suggests landlords should remain cautious about market conditions.

Tom Bill, Head of UK Residential Research at Knight Frank, highlighted regional pressures, especially in London and the south-east, where rents continue to rise due to landlords exiting the market amid regulatory and tax changes. He also pointed to the forthcoming Renters’ Rights Act as a critical factor for the lettings sector, noting that some prospective landlords are delaying decisions until the impact of new rules on no-fault evictions and void periods becomes clearer.

## Summary

The ONS data confirms that while rental growth is slowing, rents and house prices continue to rise across the UK, reflecting ongoing supply-demand imbalances. Landlords and letting agents should monitor regional variations and legislative changes closely, as these will influence rental market dynamics and investment decisions in 2026.

Suggested internal link anchors
– private rents across the UK
– average monthly rents
– rental growth in England
– house price trends
– rental inflation
– supply and demand imbalance
– Renters’ Rights Act
– regulatory changes for landlords
– regional rental variations
– market pressures in London and south-east
– letting agents’ market outlook
– property investment considerations

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/