UK Housing Sector Braces for Volatile Inflation Path Ahead

Ortec Finance has published its Q3 2026 Quarterly Economic Outlook for UK housing associations, warning that static forecasting is no longer sufficient due to ongoing shifts in CPI, interest rates, and construction costs.

The report highlights a rise in the 2027 CPI expectation to 3.4%, up from the 2.9% forecast in Q2 2026. The 2028 figure has been revised down to 2.9%. This increase implies a 3.4% rent rise from April 2027, considering September's CPI figure is typically used to set annual rent increases across the UK social housing sector.

Ortec Finance also notes that inflation stood at 2.6% in July and the Bank of England has signaled its 2% target may not be met soon, with rising energy prices adding upward pressure on inflation.