The rental market in England is starting to stabilise, the latest Goodlord Rental Index suggests.

In January 2026, average rents rose 2.4% year-on-year, reaching £1,201 per property—up from £1,174 in January 2025.

This marks a significant slowdown from last year, when rents jumped 4.6% over the same period. Alongside longer void periods, the figures point to easing tenant demand after years of fierce competition.

Notably, rental inflation now sits below Consumer Price Inflation, which was 3.6% in December, and also below wage growth at 4.5%, indicating rental price rises are lagging behind broader economic trends.

This January, all but one of the nine regions monitored by Goodlord recorded an annual rise in the cost of rent. The most significant price shift was seen in the North East, where rents are up 6% year-on-year. The East Midlands, North West, South East, and South West, all recorded inflationary increases of over 3%.

The only region to record a year-on-year reduction in rental prices was the East of England, where rents dipped by 1.9% compared to last January.

Month-on-month, January rents increased by 2% compared to December, after a notable dip in prices over the Christmas period. Rents climbed from £1,178 to a new average of £1,201, as the market shook off some of its winter chill.

The most sizeable shift was recorded in the North East, where prices rose by over 8% in January. The South West saw month-on-month rises of 6% and prices rose in London by 3%.

However, there weren’t price rises across the board. The South East, East of England, and Yorkshire and the Humber all recorded slight declines compared to December figures, indicating softening demand in certain regions.

The early signs of subdued demand were also seen in this month’s void averages. Void periods – the length of time a property sits vacant between lets – lengthened in January: rising from 23 days to 26 days.

The Index recorded a lengthening of voids in six out of the nine regions monitored. Averages jumped from 18 days to 26 days in the North West, and were up from 21 to 32 days in the East of England.

Voids only shortened in one region – London – and remained unchanged month-on-month across the East Midlands and Yorkshire and the Humber.

These void figures, alongside the cooler of annual rental pace inflation, could indicate a softening of tenant demand across England, as a favourable mortgage market tempts renters into ownership, and falls in net migration take pressure off the rental system.

William Reeve, CEO of Goodlord, commented: “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. 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.”

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