Market Predictions for 2026
What lies ahead for the residential property market in 2026? Rightmove has released its latest outlook, highlighting cautious optimism for the year ahead.
House prices unexpectedly fell by 0.6% last year, but are forecast to rise by around 2% nationally in 2026 as affordability gradually improves. Regional differences are expected to continue, with stronger growth predicted in Scotland, Wales, and the North of England. In contrast, London and the South of England are likely to experience slower price growth.
First-time buyers may benefit from an increased supply of homes, giving them greater negotiating power. In addition, rental growth has slowed, which could help some buyers save towards a deposit. Despite this, many new purchasers are still expected to rely on financial support from the so-called “Bank of Mum and Dad” to enter the housing market.
At the top end of the market, activity may remain subdued due to the proposed Mansion Tax on properties valued above £2 million, which is scheduled to come into effect in April 2028.
London Prime Market
Data from Benham and Reeves indicates an increase in buyer demand across London’s prime property market during Q4 2025.
For properties priced between £2 million and £10 million, demand rose to 13.2% in the final quarter of the year. This represents a 1.2% increase on the previous quarter, although demand remains 1.3% lower compared with the same period last year. Chiswick recorded the strongest performance, with 43.3% of prime properties securing buyers—an 11.4% increase quarter-on-quarter. Islington and Putney followed closely, with sales rates of 42.4% and 42.2% respectively.
Conversely, Battersea saw the largest decline in buyer demand, falling by 7.6%, followed by Clapham at 5.3% and Canary Wharf at 4.2%.
Commenting on the figures, Marc von Grundherr, Director at Benham and Reeves, noted that despite ongoing discussions around higher taxation for high-value homes, demand in prime London strengthened towards the end of the year, with buyers willing to proceed when pricing is right.
Record Boxing Day Activity
Rightmove reported its busiest-ever Boxing Day on record in December 2025, signalling strong early interest ahead of 2026.
Property searches typically resume on 26 December, and activity surged last year with site visits increasing by 93% between Christmas Day and Boxing Day—exceeding the 87% rise recorded in 2024. In the five days following Christmas, enquiries to view properties rose by 67% compared with the five days before Christmas. During the same period, new property listings increased by 143%.
The South East, East of England, and London recorded the highest levels of activity.
Steve Pimblett of Rightmove commented that while it remains early in the year, the Boxing Day data suggests agents could experience a busy start to 2026 following a quieter December, which was affected by Budget timing and policy uncertainty.
Housing Market Outlook
Amanda Bryden, Head of Mortgages at Halifax, commented that although affordability pressures remain, the house price-to-income ratio reached its lowest level in over a decade in December. This presents a more positive outlook for first-time buyers. Taking into account potential challenges such as slowing wage growth and stable employment levels, Halifax expects house prices to rise modestly by between 1% and 3% during 2026.
Source: Halifax, January 2026
All information is correct at the time of writing (21 January 2026).
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