UK house price growth slows as landlords become more selective with portfolio decisions, according to official data published today. The Office for National Statistics reported that average UK house prices rose 1.3% to £268,000 in the 12 months to January 2026, down from 1.9% growth recorded in December 2025. London recorded its sixth consecutive month of annual price falls, with values dropping 1.7% year-on-year.
Regional divide widens as London slips further
The North West posted the strongest regional performance with prices rising 3.1%, though this was down from 4.0% the previous month. England’s average price reached £290,000, up 1.1%, while Wales saw prices climb 2.0% to £210,000. Nick Leeming, chairman of Jackson-Stops, said the market had started the year cautiously. “Buyers are willing to proceed where value stacks up, the home is well-presented, and the price is right – realistic pricing is king in today’s market,” Leeming said. “With the situation in the Middle East remaining volatile and interest rate expectations shifting, we’re likely to see some buyers move to get transactions agreed sooner rather than later.”
Lenders pull back as landlords restructure
The data arrives as lenders become increasingly selective about buy-to-let lending, creating additional challenges for portfolio expansion. Alex Upton, managing director of specialist mortgages and bridging finance at Hampshire Trust Bank, said landlord behaviour was adjusting to tighter conditions. “Expansion is no longer the default. Many are reassessing exposure, refining portfolios and prioritising assets that offer stronger and more reliable income,” Upton said. “We are starting to see lenders become more selective, and in some cases step back from parts of the market. When funding options narrow at the same time as regulatory and cost pressures increase, it creates a more challenging landscape for brokers and landlords to operate within.” Nathan Emerson, chief executive of Propertymark, warned that mortgage market conditions could weigh on activity. “We have witnessed a substantial number of mortgage products, some that previously offered sub-4% rates, now being withdrawn, leaving consumers with fewer choices and generally tighter eligibility criteria,” Emerson said.
Rental market shows parallel strain
The same ONS release showed average UK monthly rents rose 3.5% to £1,374 in the 12 months to February 2026 – the joint-lowest annual inflation rate since March 2022. Regional variations were stark: the North East recorded 7.6% rent inflation while London saw just 1.7% growth. England’s average rent reached £1,430, up 3.6%. This follows Landlord Knowledge’s recent report on government data gaps, which revealed ministers cannot track how many landlords are exiting the sector. The latest figures suggest landlords are not leaving en masse but are becoming far more strategic about where and how they invest.
What this means for landlords
- If you’re refinancing: Act promptly – lenders are withdrawing products and tightening criteria. Sub-4% rates are disappearing.
- If you’re expanding: Focus on regional markets with stronger yields. The North West and North East offer better growth potential than London.
- Watch for: Further lender consolidation and product withdrawals as the Middle East situation affects rate expectations.
- Bottom line: This is a market rewarding selectivity over volume. Quality assets with reliable income are outperforming speculative additions.
Editor’s view
The days of portfolio expansion as a default strategy are over. Landlords who treat this as a signal to consolidate into better-performing assets – rather than exit entirely – are likely to emerge in a stronger position when conditions stabilise.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 25 March 2026
Sources: Office for National Statistics, Jackson-Stops, Hampshire Trust Bank, Propertymark
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