What's really happening in your local rental market.
Your local lettings market update.
The headlines painted a bleak picture. But the data tells a different story. Despite the Renters' Rights Act and other regulatory changes, the rental market hasn't unravelled. In fact, it's found a healthier rhythm. Rather than sharp spikes and dramatic shifts, we're seeing a market that's a little calmer, a little steadier and ultimately more balanced.
Tenant demand remains healthy, but after several years of exceptional activity, we're returning to conditions where realistic pricing, high standards and proactive management once again make the difference.
Below, we explore what's driving that shift and why it's good news for landlords.
Insights from Our Lettings Director.
Written by Michael Gallagher, Prospect Lettings Director
The first half of 2026 has marked a noticeable shift in the lettings market. After several years of exceptional demand, record rental growth and limited housing supply, the market is settling into a more balanced and sustainable position.
This year, tenant demand has returned to more normal levels, averaging 8.9 applicants per property compared with 10.3 in 2025. This is creating a healthier environment for landlords and tenants alike.
That means success is no longer driven by market conditions alone. Instead, landlords with well-maintained and well-priced properties are the ones continuing to achieve the strongest results.
Our own performance reflects that. During the first half of the year, we increased the number of lets agreed from 837 to 866, improved our Instruction to Let conversion from 91% to 97%. To me, that's evidence that when the fundamentals are right, landlords continue to perform strongly, even as the market becomes more balanced.
Investment Spotlight.
Here are our featured investments, chosen for their location, demand and long-term growth potential.
We also have two new developments in Maidenhead and Slough, Horlicks Quarter and Spring Hill, both located in areas undergoing regeneration. Within walking distance of the Elizabeth Line, they offer fast connections into London and easy access to local amenities.
View our New Homes developments
Making Tax Digital.
With Making Tax Digital being introduced for landlords, now is a good time to review how you keep financial records. Although the changes won't affect everyone immediately, preparing early can make the transition much smoother and help reduce the administrative burden when the new rules apply.
To help landlords prepare, we've partnered with Hammock, an HMRC-recognised landlord accounting software provider, to help make record keeping and tax reporting simpler.
Hammock allows landlords to track rental income and expenses in real time, as well as receive reminders for important compliance documents. As one of our managed landlords, you're also eligible for a 10% discount on monthly and annual subscriptions.
If you'd like to learn more about Making Tax Digital, including who it applies to and when the changes take effect, read our 2026 compliance checklist.
Political Outlook.
The first half of 2026 has seen a stable market. With a new Prime Minister, there was concerns that Burnham would put forward a proposal for a Proportional Property Tax, which would replace stamp duty and council tax with an annual charge of 0.48% of a property's current value. Second homes and empty properties would pay 0.96%.
Burnham has since come out to announce that this change is not going to happen in the next budget.
We'll continue to keep a close eye on any announcements and explain what they could mean for landlords, tenants and the wider market.
Property market predictions for the rest of 2026
Written by Michael Gallagher, Prospect Lettings Director
As we move into the second half of 2026, I'm optimistic about the market.
I expect tenant demand to remain resilient, supported by continued affordability challenges in the sales market and an ongoing need for quality rental accommodation. At the same time, supply should continue improving gradually, giving tenants greater choice and making pricing strategy, presentation and service increasingly important.
I don't expect to see the exceptional rental growth of recent years continue at the same pace, but equally I see little evidence of any significant downward correction in rents. Instead, I believe the market will continue to mature into a healthier, more balanced environment, where landlords who invest in their properties, respond to tenant expectations and adapt to an evolving regulatory landscape will continue to perform strongly.
Balanced conditions encourage realistic pricing, reward high standards and create more sustainable long-term outcomes for landlords and tenants alike.
Find your local Prospect lettings Branch
We’re always happy to chat through any section from this report or provide clear advice for your property or portfolio. You can find your local office using the button below:
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