- Average monthly rents increased 3.4% in the 12 months to March, to £1,377, while annual rental inflation slowed from 3.6% a month earlier (Source: Private rent and house prices, UK: April 2026 – Office for National Statistics)
- Average house prices were up 1.2% in the 12 months to February – this is a slight uptick from 1% in the year to January
- Prices in London have fallen 3.3% in the past 12 months – the seventh consecutive month of annual falls in the capital
- Why those planning to downsize should focus on building pension wealth
- Renters need all the help they can get to purchase a home
Sarah Coles, head of personal finance at AJ Bell, comments:
House prices
“Sellers faced more bad news in February, as house prices fell in London, the South East and the South West, and overall delivered gains of just 1.2% in a year. This is a slight uptick from the previous month, but is still a reflection of a seriously sluggish market.
“The North-South divide is widening, with prices in Yorkshire and The Humber, the North East and the North West all rising more than 3% in a year, while prices in London fell 3.3%. This owes an awful lot to just how expensive properties have become in the capital and across much of the south of the country.
“Life is likely to get even tougher for sellers in the coming months, as mortgage rates threaten to keep rising and sentiment cools. The war in Iran is taking a toll on the market and raising inflation fears. This pushes up interest rate expectations, powering gilt yields which make fixed rate mortgages more expensive. It means more buyers could find themselves priced out of the market, so sellers have to cut their prices to make a sale or hang on in the hope that things improve.
“It makes life harder for every seller, but can cause real issues for those planning to downsize. If this is part of your plan for income in retirement, you need to bear in mind the difficulty of timing a sale and the fact you may end up needing to part with the property when the market is disappointing. It’s why the core of your retirement income should be your pension, which offers far more liquidity and flexibility.
Rents
“Rents are rising at their slowest pace for four years. They’re being outstripped by wage inflation and they’re only fractionally above broader price inflation, all of which will be a relief for renters.
“However, it doesn’t undo the damage done over the past few years, and we’re not out of the woods yet. An awful lot will depend on mortgage rates, which tend to rise when the market is expecting higher inflation. If mortgage rates push up too far, buy-to-let landlords will pass on at least some of the pain to tenants, so we’re likely to see rent rises speed up again.
“Finances are already tight for private renters, who spend an average of 34% of their household income on putting a roof over their head – compared to those with mortgages who spend 19%, according to the government’s latest figures. It’s no wonder they need all the help they can get to escape from the rental cycle and buy a place of their own – whether that’s from the Bank of Mum and Dad or the government bonus of up to £1,000 a year from the Lifetime ISA.”