Residential Property Review – January 2026

House prices expected to rise 2% in 2026, with stronger growth outside London and the South First-time buyers benefit from more supply and slower rent growth, improving negotiating power and savings potential Prime London demand remained mixed, while Boxing Day activity hit records, signalling a busy start to 2026 

Market predictions for 2026 

What’s in store for the residential market this year? Rightmove has shared its predictions. 

House prices unexpectedly fell by 0.6% last year, however they are anticipated to increase nationally by 2% in 2026 as affordability improves. Regional variations will persist, with stronger price growth expected in Scotland, Wales and the north of England. Meanwhile, London and the south of England will likely see slower growth.  

First-time buyers may benefit from a greater supply of homes giving them more negotiating power. Plus, rent is rising at a slower annual pace, which may help prospective FTBs save up for their deposit. However, many new homeowners will still rely on help from the Bank of Mum and Dad to get on the property ladder.  

At the very top end of the market, there may be some sluggishness – this is due to the new Mansion Tax on homes above £2m, which is due to come into effect in April 2028.   

London prime market 

According to data from Benham and Reeves, buyer demand in London’s prime property market increased in Q4 2025.  

For homes in the capital valued between £2m and £10m, demand rose quarterly to 13.2% in Q4. This is up 1.2% on the previous quarter but down 1.3% when compared with the previous year. Chiswick recorded the strongest activity, with 43.3% of prime properties securing buyers. This represents an 11.4% quarterly increase. Islington and Putney followed closely behind, selling 42.4% and 42.2% of prime properties respectively.

Meanwhile, Battersea saw the sharpest decline in buyer demand (7.6%), followed by Clapham (5.3%) and Canary Wharf (4.2%).  

Director of Benham and Reeves, Marc von Grundherr commented, “Despite the renewed noise around further taxation on higher value homes, prime London demand strengthened as we moved through the final quarter of the year, with buyers clearly prepared to act on the right property at the right price.”  

Boxing Day activity reaches record high  

Rightmove recorded its busiest ever Boxing Day in December 2025.  

Housing activity typically recommences on 26 December after the festive season and 2025 was no exception. Rightmove reported a record number of site visits, with traffic rising 93% between Christmas Day and Boxing Day. This is bigger than 2024’s surge of 87%.  

In the five days after Christmas, enquiries from those wanting to view homes rose by 67% when compared with the five days before Christmas. Over this same period, new property listings increased by 143%. The South East, East of England and London saw the highest levels of activity.  

Steve Pimblett at Rightmove commented, “It’s early days, but Boxing Day’s data suggests agents could have a busy start to 2026 after a quieter festive period during December, which was also impacted by the lateness of the Budget and the uncertainty around potential policies in the lead up to it.” 

Housing market outlook  

Amanda Bryden Halifax’s Head of Mortgages 

“While affordability pressures persist, the house price to income ratio was at its lowest in over a decade in December, striking a positive note for those looking to purchase their first home. On this basis and recognising the headwinds that may affect buying power – such as the slowing of wage inflation and flattening employment rates – we expect a modest rise in house prices during the year of between 1% and 3%.” 

Source: Halifax, January 2026  

(All details are correct at the time of writing 21/01/26) 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.  

It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for information only. We cannot assume legal liability for any errors or omissions it might contain. No part of this document may be reproduced in any manner without prior permission 

Commercial Property Review – January 2026

Office demand stays strong — investors favour offices, though tenants are more selective on location Retail outperformed in 2025 — strong occupier markets and highest total returns, with investment volumes expected to pick up in 2026 Hotel investment slowed but resilient — single-asset deals kept momentum; outlook for 2026 is stronger with more portfolio activity 

Commercial property trends for 2026 

With the new year underway, what does 2026 have in store for the commercial property market? Property experts Savills have shared their predictions.  

There was much uncertainty in the months running up to the Chancellor’s Budget in November 2025. Now that the announcement has happened, it’s likely that the market will stabilise as investors and businesses proceed to make informed decisions about their transactions. Despite this, Mat Oakley, Director of Commercial Research at Savills, noted that “the environment for economic growth remains sluggish.” However, this is not expected to have the usual downward effect on occupational activity, due to limited supply and construction activity.

Overall, offices are on track to be the most popular among investors this year. Tenants are increasingly selective about location. Meanwhile, the rapid growth of the AI sector makes it likely that competition for data centre sites will increase further this year.  

A review of the retail sector  

A report from Knight Frank shows that the retail sector performed well last year despite weak macro-economic growth.  

In 2025, retail was the best-performing property asset class, recording a total return of 9.6%. This is much higher than the overall average of 6.6% for all property. Shopping centres and food stores delivered the highest returns (both 10.2%), just ahead of retail warehousing (9.8%).  

Stephen Springham, Head of UK Markets at Knight Frank observes that “retail occupier markets are arguably in their best state for over a decade.” However, this has not yet been reflected in the investment market. Total retail investment volumes for 2025 are estimated to come in at £5.83bn, down 17% on the previous year and 8% lower than the 10-year average. Volumes are likely to pick up this year, as a number of significant shopping centre deals were agreed at the end of 2025.  

Investment in UK hotels dips 

Recent data from Savills shows that UK hotel investment dipped in 2025.  

It is estimated that UK hotel investments reached £5bn last year, which is down 15% when compared with 2024. However, this is in line with the ten-year average of £4.7bn. 

There was strong activity towards the end of 2025, with hotel investment volumes exceeding £2bn in Q4, 40% higher than the same period in 2024. Portfolio transactions declined from £3.1bn in 2024 to £750m in 2025.  

Head of Hotel Capital Markets at Savills, David Kellett, commented, “UK hotel transactions proved resilient in 2025 driven by a liquid single asset market, and the enduring appeal of London, which had its strongest year of investment volumes since 2018. Despite continuing cost challenges for hospitality businesses, we anticipate a strong year ahead in 2026 with more portfolio deals, building on the positive momentum in the fourth quarter of 2025.” 

Scottish market update 

The Scottish commercial property market showed resilience in 2025 despite wider economic uncertainty. 

Knight Frank analysed Real Capital Analytics data, finding that investment volumes hit £1.96bn at the end of last year. This is close to the five-year average of £1.97bn. Alasdair Steele, Head of Scotland Commercial Property at Knight Frank, commented, “While we have just about hit the £2bn mark, there are several deals that were close to concluding that will now fall into 2026, after a flurry of activity in November and December.”

Retail was the strongest-performing sector, accounting for £717m of investment, followed by offices which attracted £461m. Large office transactions included Quartermile One in Edinburgh and The Sentinel in Glasgow.  

After a promising start for hotels in 2025, investment slowed in H2, reaching £322m by the end of 2025. Industrials accounted for £367m, which is the second-lowest level the sector has seen since 2020.   

All details are correct at the time of writing (21 January 2026) 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.  

It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for information only. We cannot assume legal liability for any errors or omissions it might contain. No part of this document may be reproduced in any manner without prior permission 

News in Review

Trump’s Greenland stance fuels NATO tensions and tariff threats, unsettling markets ahead of the World Economic Forum  World Bank forecasts modest yet resilient global growth, while warning the 2020s may be the weakest decade since 1960s   UK economic data shows slight momentum, with housing sentiment improving as borrowing cost expectations shape 2026 outlook  

“Any decision about the future of Greenland belongs to the people of Greenland” 

Keir Starmer spoke from Downing Street on Monday morning in response to President Trump’s intention to take control of Greenland because of its strategic Arctic position and mineral wealth. The Prime Minister said Trump was “completely wrong” to threaten tariffs against countries opposing the move, urging for the issue to be resolved through calm discussions between allies, not trade wars or military action. 

Sir Keir said, “Any decision about the future status of Greenland belongs to the people of Greenland and the Kingdom of Denmark alone. That right is fundamental.” On tariffs, he added, “It is not the right way to resolve differences within an alliance, nor is it helpful to frame efforts to strengthen Greenland’s security as a justification for economic pressure.” 

His comments came amid fears the UK and EU could be pushed into recession by potential US tariffs of 10% or 25%. EU leaders, led by French President Emmanuel Macron and German Chancellor Friedrich Merz, warned they would impose counter-tariffs if this happened. European Commission President Ursula von der Leyen said the EU’s response would be “unflinching, united and proportional,” while Greenland’s Prime Minister urged citizens to prepare for the possibility of an invasion. 

Concerns that the dispute could fracture the NATO alliance are intensifying. Even US Republican representatives have warned the President about the risks of his approach. The situation comes as the World Economic Forum (WEF) gets underway in Davos, where global finance leaders are congregating to embrace this year’s theme ‘A Spirit of Dialogue’. Trump’s keynote speech on 21 January will be closely watched.  Børge Brende, WEF Chief Executive, said the annual meeting of global business leaders will take place “against the most complex geopolitical backdrop since 1945.”  

Meanwhile, markets have become unsettled. The gold price is hovering around record highs as investors flood to the ‘safe haven’ asset. As earnings season kicks off, investors are facing a potentially volatile period as uncertainty hits the markets and the possibility of a US-EU trade war intensifies. US equities have posted significant losses, as the ‘Sell America’ trade resurfaces and the dollar is struggling. The VIX index, widely known as the ‘Fear Index’, has reached its highest level since November, currently around 20.93. The higher the VIX, the greater the level of uncertainty in the market, with levels above 30 indicating tremendous uncertainty, levels above 20 regarded as ‘high’ and below 12 as ‘low’ volatility. 

A Japan-led global bond sell-off has also commenced, as concerns over the country’s finances takes hold.  

Predictions for the global economy 

The World Bank’s most recent Global Economics Prospects report suggests that the global economy shows signs of resilience, despite ongoing trade tensions and geopolitical uncertainty. 

According to the research, global growth is expected to be relatively steady over the coming two years. The World Bank now anticipates growth of 2.6% in 2026 and 2.7% in 2027 – an improvement from June 2025’s forecasts. In developing economies, growth is expected to slow to 4% in 2026, then rise to 4.1% in 2027 as financial conditions strengthen.  

Despite some areas of resilience, the 2020s are likely to be the weakest decade for global growth since the 1960s. Indermit Gill at the World Bank commented, “Over the coming years, the world economy is set to grow slower than it did in the troubled 1990s – while carrying record levels of public and private debt. To avert stagnation and joblessness, governments in emerging and advanced economies must aggressively liberalise private investment and trade, rein in public consumption, and invest in new technologies and education.” 

Ahead of President Trump’s tariffs threat, in its latest world economic outlook, the International Monetary Fund (IMF) warned that trade tensions and a reversal in the artificial intelligence (AI) boom are among the main risks to global economic growth, describing the global economy as ‘steady’, with growth expected to remain ‘resilient’ this year. 

Uptick in UK growth 

Latest data from the Office for National Statistics (ONS) indicates UK GDP grew by 0.1% in the three months to November, marking a slight improvement on the three months to October, which saw no growth. On a monthly basis, the economy is estimated to have expanded by 0.3% in November. This was stronger than economists had expected, with forecasts predicting monthly growth of 0.1%.  

Here to help 

Financial advice is key, so please do not hesitate to get in contact with any questions or concerns you may have. 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. 

All details are correct at time of writing (21 January 2026) 

Make life insurance a New Year priority

Life insurance offers essential protection for loved ones when you are no longer around More assets are subject to IHT, so life insurance can help reduce your tax liabilities Reviewing policies in 2026 ensures cover remains effective, tax-efficient and aligned with evolving personal needs 

As 2026 kicks into full swing, sorting out your life insurance policy may be less glamorous than other New Year’s resolutions you’ve made, but getting the right cover for your needs can bring peace of mind to you and your loved ones – and might help reduce your Inheritance Tax (IHT) liabilities too. 

Inheritance questions 

With the IHT threshold frozen in place for more than a decade, some families seeking to reduce the size of their taxable estates have been turning to life insurance, research1 suggests. 

After the government made more assets subject to IHT, including business property and agricultural property, both assets traditionally passed on as inheritance, the appeal of life insurance has come into sharper relief for many. Faced with a growing list of taxable assets, people are thinking harder about how to minimise their tax bill. 

Protection and a lower tax bill  

Life insurance provides support for your loved ones when you are no longer around, ensuring they have full financial resilience. Moreover, life insurance is tax efficient, as payouts are free from Income Tax and Capital Gains Tax, and when held within specific types of trusts, they can also be exempt from IHT. Time for a life insurance review? 

1TWM Solicitors, 2025 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. The Financial Conduct Authority does not regulate Will writing, tax and trust advice and certain forms of estate planning. Financial protection policies typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse. 

Future ready: Tune into Budget changes now

“The Chancellor is relying heavily on tax rises towards the back end of the parliament” Income Tax thresholds will remain unchanged until at least 2031, so more earners will be in higher tax bands The basic Dividend Tax rate will rise to 10.75%, while the higher rate will increase to 35.75%  

Now the dust has settled on the Budget, and everyone has had a chance to process the key announcements – you can step back and think about what it all means for you and your finances. 

A series of tax and spending measures were unveiled, estimated to raise an extra £26bn a year in taxes by 2029/30. While immediate changes were limited, as Helen Miller, Director of the Institute for Fiscal Studies (IFS) said, “the Chancellor is relying heavily on tax rises towards the back end of the parliament. More borrowing for the next few years, then a sharp adjustment.” 

Significant changes 

Some of the changes on the horizon, worth tuning into now, include: 

  • Income Tax thresholds will remain unchanged until at least 2031, meaning more earners will be in higher tax bands, and National Insurance contributions (secondary threshold) are also frozen to 2031 
  • Properties in England valued at £2m or more in 2026 will face a new High Value Council Tax Surcharge (HVCTS) of £2,500, with an annual levy of £7,500 owed for homes worth £5m plus, from April 2028 
  • From April 2029, only the first £2,000 of pension salary sacrifice will be exempt from National Insurance, affecting the tax efficiency of many salary sacrifice arrangements 
  • A new mileage-based road tax for electric (3p per mile) and plug-in hybrid (1.5p per mile) vehicles will be introduced from 2028 
  • The annual Cash ISA allowance will be cut to £12,000 for those under 65 from April 2027, with the remaining £8,000 only permitted to be invested in Stocks and Shares ISAs 
  • Tax on savings and property income will rise by 2 percentage points from April 2027 
  • Extended the freeze on Inheritance Tax (IHT) thresholds from 2030 to April 2031. 

More imminent 

From April 2026, the Dividend Tax rate will increase by 2 percentage points. The basic Dividend Tax rate will rise from 8.75% to 10.75%, while the higher rate will increase from 33.75% to 35.75%. Following repeated cuts to the tax-free annual Dividend Allowance, which now stands at just £500, people who hold investments outside of a Stocks and Shares ISA or SIPP, or who own their own business and pay themselves in dividends, are expected to pay more tax. 

With the government pressing ahead with changes to the Inheritance Tax rules regarding unused pensions, which take effect from April 2027, there’s plenty to think about. We’re here to help you navigate the changes. 

Tax legislation and rates can change, and their application depends on individual circumstances. 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. The Financial Conduct Authority does not regulate Will writing, tax and trust advice and certain forms of estate planning. 

Looking ahead: turning property goals into reality in 2026 

Now is the ideal time to take stock and plan for the next year with confidence We can help make your property dreams a reality, whether you’re an FTB or a home mover We’ll make sure your protection plans continue to safeguard what matters most, giving you peace of mind 

As we welcome 2026, we want to thank you for your continued trust and partnership throughout 2025. 

Looking ahead, we’re here to help you make 2026 the year your property dreams take shape. Whether you’re buying your first home, moving up the ladder or reviewing your mortgage, we’ll work with you to find the right solution for your needs. We’ll also make sure your protection plans continue to safeguard what matters most. 

Now is the ideal time to take stock and plan the next steps with confidence. Together, we’ll ensure your mortgage and protection strategy supports your long-term goals, giving you clarity, security and peace of mind for the year ahead and beyond. 

Here’s to a successful 2026 – and to helping you make your home and financial aspirations a reality. 

As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments. Financial protection policies typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse. 

News in Review

Scotland’s draft Budget raises Income Tax thresholds, adds new Council Tax bands and prioritises healthcare and family support Additional measures include college funding increases, primary school breakfast clubs and major capital investment across infrastructure Halifax data shows UK house prices fell again in December, with values and annual growth both continuing to soften 

“This is a government that wants what’s best for Scotland” 

On 13 January, Scottish Finance Secretary Shona Robison delivered her draft Budget, outlining key tax and spending plans for the forthcoming financial year, running from 1 April 2026 to 31 March 2027. 

The Scottish government usually announces its Budget in December but due to the late timing of Rachel Reeves’ Budget on 26 November, decided to delay the fiscal event to give Scottish ministers sufficient time to properly evaluate the UK government’s fiscal decisions and their potential impact north of the border.    

At Holyrood on Tuesday afternoon, Robison declared that her Budget is one “For Scottish families… a stronger NHS and… investment in Scotland’s infrastructure,” adding, “This is a government that wants what’s best for Scotland.” 

One of the main taxation measures announced was the raising of two of the six Scottish Income Tax bands by 7.4% for the 2026/27 tax year. The Basic rate (20%) threshold, which currently starts at £15,398, will go up to £16,537. The Intermediate rate (21%) threshold, which currently starts at £27,492, will increase to £29,526. Robison said this change will mean over half (55%) of Scottish workers “are set to pay less Income Tax because they live in Scotland.” 

Another major tax announcement was the introduction of two new Council Tax bands by April 2028 for the most expensive properties in Scotland. Higher rates will be paid on properties worth over £1m based on an up-to-date valuation. A budget of £5m has been set aside for a targeted revaluation of the most valuable properties and reallocation into the two extra higher Council Tax bands – one for properties valued between £1m -£2m, and one for homes valued over £2m. The money raised will go directly to the local councils where the homes are located. 

Other key measures included: 

Healthcare 

  • Record funding – £22.5bn investment in health and social care, including in; 
  • Walk-in GP clinics – (£36m) to establish new high street clinics, supporting access to same-day appointments 

Welfare and education 

  • Scottish Child Payment – will be boosted for families with a baby under the age of one to £40 a week from £27.15 per week, from 2027/28 
  • College funding – to be increased by 10%, providing an extra £70m 
  • Breakfast clubs – to be introduced in every single Scottish primary and special school by August 2027 

Business  

  • Support for high-growth firms – to attract private investment and connect entrepreneurs 
  • Small business bonus scheme – which removes rates from 100,000 small businesses, will be continued for three years 
  • Non-domestic rates relief – of 15% in 2026/27, worth £138m over three years for retail, hospitality and leisure premises 

Other 

  • Capital investment programme – for longer-term projects like roads and buildings worth £7.6bn to deliver “significant economic benefits across our economy” 
  • Local government – funding will increase by 2% in real terms 
  • New homes – record investment in new affordable homes  
  • Public sector reform – will provide £1.5bn in efficiencies to help protect frontline services 
  • No changes to Land and Buildings Transaction Tax (LBTT) were announced.  

Robison said her Budget, “Will fund landmark policies to continue efforts to eradicate child poverty – investing in a brighter future for Scotland and the children growing up here.” 

Members of the Scottish Parliament (MSPs) will now move on to debate the proposed Budget and can table amendments, before a vote is taken to pass it into law.  

The Budget will be followed by the Holyrood election on 7 May, when Scots will head to the polls. The main parties are ramping up their campaigns; the SNP are currently leading in the polls.  

House price data “subdued” end to the year 

UK house prices fell again in December, according to latest Halifax data, with values down 0.6% following a 0.1% decline in November. The average property price now stands at £297,755, its lowest level since June, as annual growth slowed to 0.3% from 0.6% the previous month.  

Here to help 

Financial advice is key, so please do not hesitate to get in contact with any questions or concerns you may have. 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. 

All details are correct at time of writing (14 January 2026) 

New year, new home?

If you’re hoping to move home in 2026, get your finances in good shape first  Remember to factor in moving costs, such as solicitor fees, surveys, removals and Stamp Duty Take stock of possessions, create a room plan and keep track of boxes and their contents.

If you’re hoping to make a move in 2026, here are some top tips to help you plan ahead and beat the stress. 

Before you start looking at properties, it’s worth getting your finances in good shape. Speak to us about finding a suitable mortgage and checking what you can comfortably afford – this will give you a clear picture of your budget before you start house-hunting. Remember to factor in moving costs, such as solicitor fees, surveys, removals and Stamp Duty, as these can quickly add up. The more financially prepared you are, the smoother and less stressful your move will be when the time comes. 

And when the time comes… 

  • Streamline your stuff – moving home is the perfect time to take stock of your possessions. Before you pack, identify any unused items that could be sold or donated 
  • Keep track of boxes and contents – make sure every box is labelled with a specific room and a brief description of its contents, this will help simplify the unpacking process and support any insurance claims 
  • Create a room plan – make sure you know where furniture is going in advance. Measure the space as well as entrances and doors to prevent any problems on the big day 
  • Stay connected – as soon as your moving date is confirmed, it’s a good idea to start the broadband ball rolling 
  • Pack an essentials box – make sure you have easy access to key items on move day, such as mugs, mobile chargers, cleaning supplies and linen. Keep your essentials box separate from everything else, so it doesn’t end up buried at the back of the removal van. Add the kettle, tea, coffee and milk to the box last – moving is thirsty work! 

As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments.  

Investing in 2026: Opportunity ahead in a changing world?

Investors approach 2026 cautiously as inflation, trade tensions and geopolitical risks continue to shape global market conditions The IMF predicts global growth of 3.1% this year, but some regions and sectors may outperform others Diversification will be key amid 2026’s evolving landscape – make sure to balance suitability with long-term growth opportunities 

After a year of uncertainty, with many macroeconomic and geopolitical tensions affecting the landscape, investors may well be looking toward 2026 with cautious optimism. Despite the shocks of ‘Liberation Day’ trade announcements and the resulting sell-off, markets rebounded strongly last year to reach highs amidst persistent inflation, trade trauma and an AI-fuelled rally. 

In an era where headlines can move markets within minutes – what’s the lesson for investors? Staying nimble, pragmatic and avoiding knee-jerk reactions remains key. So, what’s coming for investors in the year ahead? As 2026 gets underway, some themes are taking shape. 

Balancing risks and rewards 

The coming year, as ever, promises a mix of challenges and opportunities. Inflation in some key advanced economies remains above target, leaving monetary policy finely balanced. Persistent inflation could weigh on consumer sectors, demanding selective positioning, lower borrowing costs could support equities and despite notions of an AI bubble, continued investment in data centres and innovation may sustain growth opportunities; time will tell. Markets may well be expecting rate cuts in 2026, but central banks may act more conservatively. 

Global growth and strategic positioning  

According to the International Monetary Fund’s (IMF’s) latest outlook, the global economy is projected to grow by 3.1% this year, down from 3.2% in 2025. IMF notes that while growth remains positive, it is fragile, reflecting ongoing risks from tariffs, trade tensions and geopolitical uncertainties, while other drivers including technological investment, fiscal support and favourable financial conditions are offsetting potential upsets. IMF highlights that with an uneven recovery likely, some regions and sectors may outperform, while others remain more vulnerable. 

A smarter way to invest  

Diversification will therefore remain a guiding principle for 2026 – balancing exposure to sectors, regions and asset classes, in line with your risk tolerance, objectives and timescale. Identifying sectors benefitting from long-term trends, mitigating risks, optimising asset allocation and adapting strategies to market dynamics – that’s on our agenda in 2026. 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. 

House Prices – what to expect in 2026 and beyond

Regional growth will be uneven, with the strongest price rises expected in more affordable northern regions Early years of low growth may help first-time buyers before the market strengthens from 2027 onward Buy-to-let activity may rise, but regulation and taxation will continue to limit overall investor appetite 

As 2026 begins, many homeowners and would-be movers are reassessing their plans. The latest five-year outlook from real estate services company Savills offers a clear view of where the property market may be heading, suggesting a slow start, followed by a steady and sustained recovery through to 2030. 

Savills expects subdued price growth in the short term, with average UK house prices estimated to have risen by just 1.0% in 2025 and believed likely to pick up to 2.0% in 2026. This muted pace reflects ongoing economic uncertainty and softer buyer demand still working its way through the market. 

Momentum is expected to build from 2027 as, on current economic predictions, interest rates continue to ease. The forecast points to price growth of 4% in 2027, 5% in 2028 and a peak of 5.5% in 2029, followed by 4% in 2030. Over the five-year period, Savills predicts a total increase of over 22% in UK house prices. 

Regional outlook 

Price growth will not be evenly distributed. The strongest increases are forecast in more affordable regions such as the North East, and Yorkshire and the Humber, where values could rise by around 28.8% by 2030. 

By contrast, growth in London and the South of England is expected to lag, limited by affordability pressures. In London, house prices are forecast to rise by a more modest 13.6% over the same five-year period. 

What this means for different buyers 

  • First-time buyers – early years of low growth may offer an opportunity to buy before prices are expected to accelerate from 2027 onwards 
  • Growing families and upsizers – those planning a move over the next three to five years may benefit from rising equity as the market strengthens 
  • Buyers in high-value regions – expect steadier, slower growth. Long-term planning becomes even more important 
  • Buyers in more affordable regions – stronger forecast gains could make early purchases particularly advantageous 
  • Buy-to-let investors – because of moderating prices, falling mortgage rates and rising rents, activity is expected to pick up gradually. However, any increase is likely to be limited by tighter rental regulation and higher taxation. 

Whatever your circumstances, if you need support navigating the changing property market in the coming years, please contact us for advice. 

As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments.