At Chestertons, we’re seeing a resilient London rental market, with strong activity continuing to put upward pressure on rents. Leading forecasts also indicate rental growth is set to continue throughout 2026.
In January, tenant enquiries on our lettings portal remained strong. While enquiries were slightly lower than January 2025, at just a 6% decline, they rose by 81% compared with December 2025, showing strong momentum at the start of the year. At the same time, the number of tenants moving into properties increased by 15% year-on-year, confirming a busy and active market.
Rental supply remains slightly tight, with 4% fewer properties available compared with the same period last year. At the same time, lettings market valuations doubled compared with December, suggesting more property owners are considering letting their homes in Q1. Overall, steady demand combined with limited supply keeps the market competitive, supporting rental growth and creating a favourable environment for landlords.
Our findings broadly reflect the wider market direction reported by the Royal Institution of Chartered Surveyors (RICS) in its UK-wide Residential Market Survey. While a net balance of 27% more lettings agents reported falling tenant demand than those seeing a rise, the net balance of landlords letting properties fell further, at -39%. As a result, RICS expects rents to rise by around 3% in 2026, with property portals Rightmove and Zoopla forecasting increases of 2% and 2.5%, respectively.
The London rental market continues to be supported by structural factors, including the city’s dynamic workforce, international demand, and lifestyle flexibility — all of which underpin strong tenant interest. Alongside tight supply, these conditions are keeping the lettings market competitive and supporting ongoing rental growth.
Adam Jennings, our Head of Lettings, comments:
“Our latest figures show tenant demand remains stable, supported by strong corporate interest, while rental supply continues to be limited in certain areas. This combination is keeping the London lettings market highly competitive, with properties priced in line with the market attracting multiple enquiries from high-quality tenants. With demand expected to rise towards spring, now is an excellent time for landlords to bring their properties to market.”