England’s rents rise 2.4% as tenant demand shows signs of cooling

England’s rental market showed further signs of cooling last month, with slower annual rent growth and longer void periods hinting that intense tenant competition may be easing.

The latest Goodlord Rental Index found that rents rose by 2.4% year-on-year in January.

That compares with a 4.6% annual increase recorded in January 2025, pointing to a clear slowdown in the pace of price rises.

Average rents are now £1,201, up from £1,174 a year earlier.

The rate of increase is now lower than Consumer Price Inflation, which stood at 3.6% in December, and below recent wage growth of 4.5%.

Softening demand and lower rent rises

The firm’s chief executive, William Reeve, said: “Whilst prices will continue to go up, the underlying signs point to what could be the return of some equilibrium to the market.

“The lower pace of annual rental inflation, especially compared to last January, combined with lengthening voids may indicate the early signs of softening demand.

“With current rental inflation now sitting well below the CPI and wage growth, this could swing the pendulum of power slightly back towards tenants following several years of ferocious competition for properties.”

He added: “However, the true wild card in 2026 will be the implementation of the Renters’ Rights Act in May, which could upturn rental metrics once again.”

Where rents rose

Eight of the nine areas tracked by Goodlord recorded annual rent rises, with the strongest growth in the North East, where rents climbed by just over 6%.

The East Midlands, North West, South East and South West all posted rises above 3%.

The East of England was the only region to see a year-on-year fall, with average rents down 1.9% compared with January last year.

On a monthly basis, rents rebounded in January after December’s seasonal dip, rising by 2% nationwide.

The sharpest monthly rise was again in the North East, where rents jumped by more than 8%.

London recorded a 3% increase, while the South West saw growth of 6%.

In contrast, the South East, East of England and Yorkshire and the Humber all experienced small monthly declines.

Voids get longer

Further evidence of softer conditions can be seen in void periods with the average time increased from 23 days to 26 days in January.

Voids lengthened in six of the nine regions monitored, Goodlord says.

In the North West, averages rose from 18 days to 26 days, while the East of England saw a jump from 21 days to 32 days.

London was the only region where voids shortened, slipping from 20 days to 19.