The Oxfordshire lettings market is entering a ‘rebalancing’ phase as demand has softened and supply has risen. The market is less frantic than the last few years but remains positive for landlords. Although conditions are levelling, supply does remain below pre-pandemic levels and so rents are still expected to rise in 2026 albeit at a more conservative rate compared to previous years.
ATYPICAL FAMILY HOME DEMAND
The family homes market is typically most active in the summer months, yet this year almost every area of the county saw an increase in demand for larger homes in Q1. This came from families upsizing, renters moving out of London, and those relocating from overseas. Some examples include:
- A 7-bedroom detached house in Sutton Courtenay at £3,2501
- A 5-bedroom detached house in Rousham at £5,000
- A 4-bedroom detached house in Eynsham at £2,500
- A 4-bedroom detached house in Summertown at £7,000
- A 4-bedroom terraced house in Jericho at £4,500
- A 7-bedroom detached house in Frilford (top photo) at £15,000
MORE REALISTIC PRICING
The transition from a super competitive market to a steadier one has meant applicants have felt less pressure to be decisive and even properties which have historically let very quickly have taken a little longer this time around. Hybrid working policies have also impacted how renters search. For example, our Central Oxford office showed an applicant a property less than 400m away from his workplace, but he was also viewing a property in Abingdon later that day as he only has to be in the office two days per week and felt he may get more for his money outside of the city.
With this changing dynamic, advertising rents are having to be carefully managed. For example, a 3-bedroom house in Upper Heyford had little interest before a price adjustment prompted multiple viewings and a let to a family relocating from overseas. At the smaller end of the market (1- and 2-bedrooms), there is a sense that prices are reaching their ceilings and landlords are having to take a pragmatic approach with rental negotiations.
RENTERS LEAVING TO BUY
Improved mortgage conditions have enabled a number of tenants to move out and buy their first home. According to Connells Group2, a record 34.3% of homes sold across Great Britain in January 2026 were bought by first time buyers. This move into home ownership means the homes they leave add to available rental stock, which has partly influenced the slight increase in supply. Of course, current world events may influence these levels as the year progresses.
A REALIGNMENT OF EXPECTATIONS
Landlords are understanding the expectations of tenants paying premium rents, and there has been a small trend of landlords carrying out improvements. For example, a 1-bedroom cottage near Banbury (photo above) was fully refurbished before being listed at £1,200 and letting quickly to a couple. Smaller upgrades can also make a difference. A 1-bedroom apartment in Oxford city centre had begun to look tired. Between tenancies, the landlord worked with FK Interiors to modernise the living room furniture. They wanted to retain some of the existing items, so our team worked with them to transform the property, increasing the rent by 11.8% (before and after photos below).
THE IMPORTANCE OF PROPER MANAGEMENT
The Renters’ Rights Act will be bringing property management into sharp focus for landlords. The reliance on properly documented evidence will be high, and we have seen an increase in the number of landlords switching to our hands-on property management service and the number of self-managing landlords changing to a fully managed service to reduce the risks of accidentally getting it wrong.
RELOCATIONS IMPACTING SUPPLY AND DEMAND
New instructions have also come from homeowners relocating for work for a fixed period and letting out their home when they are not ready to sell. At the same time, we have seen more renters being relocated to Oxfordshire this quarter with employers around Milton Park bringing people from overseas. Our East Oxford office has also agreed a let to an engineer coming to work on the Science Park expansion, and we anticipate more demand like this. The property will be a pied-a-terre for the working week (not a main and principal home), meaning the tenancy is exempt from the Renters’ Rights Act.
COMPARATIVELY MODEST RENT INCREASES
Rents at renewal have been increasing, but also at a more moderate rate. Tenants are reluctant to move due to the associated costs but are also contesting proposed rent increases due to overall cost of living rises. The suggested rents are always based on market values, and readily evidenced, but many landlords are understanding of tenant’s affordability and are happy to negotiate to retain a good tenant.
It’s important to note that rent increases are only ‘moderate’ in comparison with the last five years. Graph 1 shows that the average annual rental change pre-covid was much lower, and this slowing down of increases is just the market normalising.
LIFE GOES ON
Ahead of the abolition of Section 21 evictions there was some concern that landlords would suddenly serve their tenants with a Section 21 as it was their last opportunity to do so. In fact, in the final quarter of 2025 only 6,367 claims were recorded in England – the lowest level since 20223.
What is notable is that landlords have increasingly been setting up limited company structures since the restriction of mortgage interest relief in 2017. According to Paragon Banking Group4, limited companies accounted for 43% of mortgaged buy-to-let house purchases in 2025, up from 35% in 2024. This indicates that the sector is professionalising, with landlords restructuring for their long-term investment.
Of course, the seasonal nature of the lettings market is likely to change once the new legislation comes in, but the reality is that tenants will still move when they need to (upsizing, downsizing, relocating, buying) and the cost of moving means they aren’t likely to leave simply because they are no longer in a fixed-term contract. Agents will still reference applicants; tenants will still pay rent; landlords may still need to gain possession of properties for legitimate reasons. Life will go on, and the market will adapt. Good landlords have nothing to fear from these reforms.
1 All rents stated are marketing rents and per calendar month
2 https://www.connellsgroup.co.uk/news/2026/02/09/february-market-brief-record-share-of-first-time-buyers-kick-starts-2026-housing-market/
3 www.gov.uk/government/statistics/ mortgage-and-landlord-possession-statistics-october-to-december-2025/mortgage-and-landlord-possession-statistics-october-to-december-2025
4 www.paragonbankinggroup.co.uk/news/news-releases/buy-to-let-financed-limited-company-transactions-hits-record-high
