January Property Market Analysis

January is a time of fresh starts and it appears a new home is on the list for many. The omens were good following Rightmove’s busiest ever Boxing Day, with a record number of visitors. The portal’s January figures followed, indicating a positive start to 2026.

Rightmove saw buyer enquiries rise 67% in the five days after Christmas, when compared to the five days before. In that same period, new listings on the portal increased 143%. Purchasers now have the widest choice of available homes since 2014.

Average asking price powered up

Sellers started the year in a confident frame of mind. This was reflected in a new average asking price in January of £368,031. This is 2.8% more than the average asking price in December 2025 and 0.5% above last year’s average. 

Landlord yields increased

January also saw two sets of rental figures gain column inches. The first was Fleet Mortgages’ latest Rental Barometer. Its analysis showed we started 2026 with an average rental yield of 7.7% across England and Wales. 

This figure represented a quarter-on-quarter and a year-on-year yield rise, fuelled by growth in the Midlands and the North. Fleet found average yields were above 8% in the North East, the North West, Yorkshire and Humberside, the West Midlands and the East Midlands. There were more modest yield increases in all tracked southern regions too.

Rental values, however, moved in the opposite direction to yields. The latest HomeLet Rental Index found the average monthly rent agreed for new tenancies was 1.5% lower in December 2025 when compared to November. The UK’s average monthly rent is now £1,317.

Rental values dropped in all but one region and that was Wales. Here rents increased +0.3% during HomeLet’s latest monitoring period. The North East posted a miniscule -0.1% value drop, which compared to the biggest month-on-month decrease of -3.2% in London. 

January wasn’t just about the statistics. Landlords in England and Wales were told the Government was revising its approach to minimum energy efficiency standards (MEES) in private rentals. It had wanted all newly agreed tenancies to possess an EPC of at least a C in 2028, up from the current E.

Landlords given more EPC time 

This was deemed too ambitious and in January, it was announced the 2028 EPC deadline for newly agreed tenancies would be scrapped. Instead, all private rentals will need a minimum EPC rating of at least a C by 2030. The Government will also reduce the maximum amount landlords will need to invest in energy improvements – known as the spending cap – from £15,000 to £10,000 per property.

Governments didn’t stop there. Staying with energy, Prime Minister Keir Starmer announced in January that it was scrapping plans to phase out gas boilers, which would have made them unavailable by 2035. Instead, the Government will make a £15 billion fund available to some homeowners to facilitate a switch to clean heating methods.

New leasehold reforms laid out

Focus then turned to leaseholds. The Commonhold and Leasehold Reform Bill was published in January, affecting England and Wales. The vote winning headline? Existing ground rents will be capped at £250, reducing to a ‘peppercorn’ fee over a 40 year period. The Government will also make it easier for leaseholders to switch to a commonhold agreement.

The Scottish Government announced it had taken inspiration from its southern counterparts. It will reevaluate the value of premium Scottish properties to create two new council tax bands. Those in the top bands will be subjected to a High Value Property Surcharge – dubbed a mansion tax. This will be effective from April 2028 and applicable to homes valued above £1 million.

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