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UK Rent Growth Slows to Four-Year Low as Prices Diverge and Mortgage Competition Intensifies

Intensifying lender competition is beginning to ease mortgage costs for buyers.

Overview

  • ONS data show UK private rents rose 3.5% in the year to January 2026, the slowest pace since March 2022, with the average monthly rent at £1,367.
  • UK house prices increased 2.4% year on year in December 2025 but fell 0.7% on the month, leaving the average property value at £270,000.
  • London recorded a 1% annual drop in prices to an average of about £551,000, contrasting with stronger gains reported in parts of the North.
  • Rental growth varied widely by area, with Wales up 5.8%, Northern Ireland up 5.6% to November, and the North East of England up 8.0% despite having the lowest average rent.
  • Major lenders have cut mortgage deals as competition heats up, though industry figures caution that affordability pressures and remortgage risks persist.