Consultants situation verdict on potential winners and losers in 2026 housing market

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Your help makes all of the distinction. Learn extra Property specialists anticipate a robust begin for the housing market in 2026, pushed by falling mortgage charges and decreased uncertainties.

The restoration is predicted to be "bottom-up" fairly than "top-down," with challenges on the higher finish, however first-time patrons remaining a "driving power" on the property ladder.

A December base price reduce, from 4 per cent to three.75 per cent, supplied an early Christmas reward to some mortgage holders.

That is vital as UK Finance figures present roughly 1.8 million fixed-rate mortgages are on account of expire in 2026. Final yr’s "see-saw" market noticed patrons dashing to beat a stamp responsibility deadline in its preliminary months.

Round 177,370 house gross sales befell throughout the UK in March 2025 – round double (a 104 per cent improve) the quantity in contrast with the 86,810 gross sales recorded in March 2024 – based on HM Income and Customs (HMRC) figures.

However within the second half of the yr, some exercise was placed on maintain as some potential patrons took a pause amid hypothesis over potential adjustments within the autumn Funds.

The Royal Establishment of Chartered Surveyors (Rics) beforehand reported that the amount of recent house purchaser inquiries deteriorated to the weakest stage recorded in round two years in November.

Some patrons coming into the market now might discover they will snap up extra of a discount than a few months in the past. In line with property web site Rightmove, the typical asking worth for a house in Britain fell by £6,695 month-on-month in December, reaching £358,138.

<img src="https://static.independent.co.uk/2025/12/29/00/da19278280f3244a1372b67e804d3c90Y29udGVudHNlYXJjaGFwaSwxNzY1OTY1MzIz-2.72726731.jpg" srcset="https://static.independent.co.uk/2025/12/29/00/da19278280f3244a1372b67e804d3c90Y29udGVudHNlYXJjaGFwaSwxNzY1OTY1MzIz-2.72726731.jpg?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/2025/12/29/00/da19278280f3244a1372b67e804d3c90Y29udGVudHNlYXJjaGFwaSwxNzY1OTY1MzIz-2.72726731.jpg?quality=75&width=640&auto=webp 640w" loading="lazy" alt="A December base rate cut, from 4 per cent to 3.75 per cent, offered an early Christmas gift to some mortgage holders" class="sc-1mc30lb-0 ggpMaE inline-gallery-btn"/> open picture in gallery

A December base price reduce, from 4 per cent to three.75 per cent, supplied an early Christmas reward to some mortgage holders (Peter Byrne/PA) Colleen Babcock, a property knowledgeable at Rightmove, mentioned: “We predict the market will feel and look very totally different relying on which space of Nice Britain you’re in, and the kind of property you’re trying to promote or purchase, with large variations notably between the south of England and the remainder of Nice Britain.”

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She mentioned market circumstances in 2026 “will favour typical first-time patrons over these on the high finish of the market”.

Richard Donnell, govt director of Zoopla mentioned: “We anticipate a stronger-than-usual rebound in exercise in (the primary quarter of) 2026 because of a giant drop in exercise within the run-up to the November Funds when many patrons delayed house shopping for choices.”

He mentioned the bottom price reduce in December “would enhance market sentiment going into the brand new yr, which may even help elevated ranges of market exercise – this can help the demand to maneuver house and general gross sales volumes fairly than resulting in a rise in home costs”.

Mr Donnell predicted: “First-time patrons will stay the driving power for the market and are set to account for 2 in 5 house purchases.”

He predicted {that a} “North-South divide” in home worth progress will stay in 2026, “reflecting the affordability of houses”.

Home worth progress in some elements of northern England has been outperforming elements of London and a few southern areas, the place home costs are sometimes considerably greater.

Mr Donnell mentioned: “Householders trying to transfer in 2026 want to grasp the worth of their house earlier than making a suggestion on a brand new house, which is most necessary in southern England.”

Taking a look at transactions, UK Finance has mentioned that it expects round 1.20 million home gross sales to happen in 2026 and 2027, down from 1.21 million in 2025.

However UK Finance has mentioned that even with “welcome tweaks” made to lending laws in 2025, affordability may be very tight and will restrict borrowing choices for potential patrons in 2026.

The Monetary Conduct Authority (FCA) has set out plans to take an additional look into how mortgage entry will be improved, probably serving to teams reminiscent of first-time patrons and self-employed folks.

Amanda Bryden, head of Halifax Mortgages, mentioned:”Looking forward to 2026, we anticipate home costs to rise modestly, by someplace between 1 per cent to three per cent.

“Whereas wage progress is predicted to sluggish and unemployment might edge greater, decrease rates of interest and easing inflation ought to assist to regularly enhance house patrons’ buying energy.”

<img src="https://static.independent.co.uk/2025/12/05/08/6bfbfd0c26e09dabc6c184ff37425f73Y29udGVudHNlYXJjaGFwaSwxNzY1MDA4MTQ4-2.24335206.jpg" srcset="https://static.independent.co.uk/2025/12/05/08/6bfbfd0c26e09dabc6c184ff37425f73Y29udGVudHNlYXJjaGFwaSwxNzY1MDA4MTQ4-2.24335206.jpg?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/2025/12/05/08/6bfbfd0c26e09dabc6c184ff37425f73Y29udGVudHNlYXJjaGFwaSwxNzY1MDA4MTQ4-2.24335206.jpg?quality=75&width=640&auto=webp 640w" loading="lazy" alt="But UK Finance has said that even with “welcome tweaks” made to lending regulations in 2025, affordability is very tight and could limit borrowing options for potential buyers in 2026" class="sc-1mc30lb-0 ggpMaE inline-gallery-btn"/> open picture in gallery

However UK Finance has mentioned that even with “welcome tweaks” made to lending laws in 2025, affordability may be very tight and will restrict borrowing choices for potential patrons in 2026 (Anthony Devlin/PA) Robert Gardner, Nationwide Constructing Society’s chief economist, mentioned that in 2025: “Annual home worth progress in Northern Eire outpaced the remainder of the UK by a large margin, averaging 11 per cent within the first 9 months of the yr, nearly 4 occasions quicker than the three per cent recorded within the UK as a complete and greater than double the 5.1 per cent recorded within the subsequent strongest performing area (the North of England).”

He added: “Wales broadly matched the broader UK pattern in 2025, whereas Scotland noticed a touch stronger price of home worth progress.

“London was the weakest performing area within the first 9 months of the yr with annual progress averaging 1.3 per cent.

“This was a part of a wider pattern that noticed home worth progress within the northern areas of England outpacing the southern areas.”

Trying to the yr forward, Mr Gardner mentioned: “We anticipate annual home worth progress to stay broadly within the two to 4 per cent vary.”

Within the Funds, the Authorities introduced a excessive worth council tax surcharge in England on houses above £2 million from April 2028.

Mr Gardner added: “The excessive worth council tax surcharge is just not being launched till April 2028 and can apply to lower than 1 per cent of properties in England and round 3 per cent in London.”

Lucian Prepare dinner, head of residential analysis at Savills, mentioned: “Our mainstream home worth forecast expects common home costs to extend by 2 per cent in 2026 or £7,200, in what is predicted to be a bottom-up fairly than a top-down restoration, given among the challenges on the high finish of the market.”

Mr Prepare dinner added: “Extra inexpensive late-cycle markets within the North, Scotland and Wales are anticipated to proceed to carry out most strongly, whereas worth progress in London and the South is more likely to stay extra subdued, on account of better affordability challenges.”

With the highest finish of the housing market anticipated to stay worth delicate in 2026, Mr Prepare dinner mentioned that “pragmatism will stay key to attaining profitable prime gross sales in 2026, creating alternatives for well-informed, practical patrons and sellers”.

Nick Leeming, chairman of Jackson-Stops, mentioned the seasonal “spring bounce” often seen within the housing market “needs to be extra pronounced than the long-term norm”.

He mentioned: “Following nearly six years of outstanding volatility pushed by Covid, fiscal shocks and political uncertainty, 2026 is now anticipated to mark a return to a extra steady and recognisable housing market.”

As housing market exercise ramps up in 2026, house patrons are being reminded to be conscious of the standard of the property they select.

Emma Toms, chief govt of the New Properties High quality Board, mentioned: “Any suggestion of house patrons re-entering the market in 2026 will come as welcome information to the development sector and the broader economic system.

“However intervals of heightened demand can put strain on builders to construct shortly. So, if we need to ease the housing disaster and make sure the uptake of new-build houses is powerful, we completely should be certain that amount by no means comes on the expense of high quality or buyer care.

“Via our business code and oversight of the New Properties Ombudsman Service, we set clear guidelines for housebuilders, drive enhancements in behaviour, and supply patrons with a path to redress if the requirements set out within the code aren't met.”