The housing market in the United Kingdom has begun 2026 on firmer footing, with fresh data suggesting early signs of recovery following a subdued period in 2024 and much of 2025. However, while confidence is improving, the pace of growth appears measured — and regional differences remain pronounced.
For buyers, sellers and movers alike, the message is clear: stability has returned, but this is not a boom market.
Prices Plateau After Strong January Surge
According to property portal Right-move, asking prices surged sharply in January — marking the strongest start to a year since 2020. However, February figures show that momentum has leveled off, with prices holding largely steady month-on-month.
This pattern suggests sellers tested the market at the start of the year, but pricing expectations are now settling into more sustainable territory. Rather than rapid gains, the market appears to be entering a phase of cautious normalisation.
Meanwhile, lender data from Nationwide Building Society indicates modest annual house price growth in early 2026, reinforcing the view that the downturn has eased without tipping into overheating.
Surveyors Report Early Signs of Recovery
The latest residential market survey from the Royal Institution of Chartered Surveyors (RICS) points to improving buyer enquiries and a stabilising sales outlook.
Surveyors report that while activity is not surging, the sharp slowdown seen during periods of higher borrowing costs has softened. Agreed sales volumes are gradually improving, and sentiment across the sector is more optimistic than it was a year ago.
This improvement coincides with slightly more favourable mortgage conditions and growing confidence that interest rate pressures are easing.
Mortgage Rates and Affordability
Affordability remains a central theme in 2026.
Recent figures from Halifax show the average UK house price now hovering around the £300,000 mark — a psychological milestone. Annual growth remains modest, generally in the low single digits.
Encouragingly for buyers, wage growth has begun to outpace house price growth in many areas, and mortgage rates have softened compared with their recent peaks. While borrowing costs remain higher than the ultra-low rates of the early 2020s, the direction of travel has improved buyer confidence.
The next moves from the Bank of England will remain crucial in shaping affordability and market momentum throughout the year.
A Clear North–South Divide
Regional variation continues to define the UK housing market.
Data from Zoopla suggests that parts of Northern England and Scotland are currently outperforming southern regions in terms of price growth prospects. More affordable entry points and steady local demand are helping to support activity in these areas.
By contrast, higher-priced markets such as London and parts of the South East remain more constrained by stretched affordability. While prime markets are stable, growth is comparatively subdued.
For movers, this means opportunities differ significantly depending on location. Buyers in higher-priced regions may find increased negotiating power, while sellers in more affordable northern markets may benefit from stronger demand.
What This Means for Buyers and Sellers
For Buyers
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Increased stock levels mean more choice.
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Slower price growth improves negotiating conditions.
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Slightly lower mortgage rates are easing monthly affordability pressures.
First-time buyers in particular may find 2026 offers a more balanced environment compared with the intense competition of previous years.
For Sellers
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Realistic pricing is essential.
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Presentation and preparation matter more in a competitive market.
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Spring and early summer remain peak moving seasons.
Sellers who price strategically and prepare thoroughly are still achieving successful completions — but overpricing can quickly stall interest.
Outlook for the Rest of 2026
Forecasts from property consultancy Savills suggest that house price growth across 2026 is likely to remain modest, typically projected in the low single digits.
Rather than dramatic rises or falls, the prevailing expectation is one of steady, sustainable movement — supported by improving confidence but tempered by economic caution.
The Bottom Line
The UK housing market in early 2026 tells a story of resilience.
After navigating higher interest rates and affordability pressures, the market is stabilising. Prices are no longer surging, but nor are they falling sharply. Buyer activity is improving, mortgage conditions are less restrictive, and regional markets are finding their own rhythm.
For those planning a move this year, the landscape is more predictable — and in many ways, more balanced — than it has been for some time.
If you’re considering buying or selling in 2026, preparation, timing and local expertise will be key to making the most of this steady but selective market.