UK Housing Market Shows Signs of Recovery: A Positive Outlook for Buyers

The latest assessment from Zoopla reveals an encouraging trend in the UK housing market as we dive into 2026. With buyers gradually returning to the market, confidence levels are on the rise thanks to falling mortgage rates and an increase in the supply of homes available for sale.

Buyer Demand Rebounds in 2026

After a lull in activity at the end of 2025, when many potential buyers postponed their moving decisions amid uncertainty, the first month of the new year is showing a strong rebound in demand. Currently, buyer activity is aligning closely with levels seen in early 2024, although it remains below the exceptionally high levels recorded last year when buyers rushed to finalize their purchases before stamp duty changes came into effect.

Positive Market Conditions

According to Zoopla, increasing competition in the mortgage market, alongside lower interest rates, is vital in supporting homebuyer confidence. There is a notable 6% rise in the total number of homes for sale, marking the largest inventory seen in the past eight years. This increase is providing buyers with more options, thereby easing competition and encouraging realistic pricing and quality presentation from sellers.

Price Trends Across the UK

The report highlights that the average UK house price has appreciated by 1.2% over the past year, rising by £3,200 to reach a total of £269,800 at the close of 2025. Notably, more affordable regions such as those in the Midlands, northern England, Scotland, and Northern Ireland have seen prices rise up to four times faster than their southern counterparts, where minor declines were recorded due to higher acquisition costs and increased supply.

What Lies Ahead

As more homes enter the market, there is renewed hope for both buyers and sellers. The overarching sentiment is that while demand remains strong for well-priced properties, sellers must adapt to the evolving dynamics of the market. Richard Donnell, the executive director at Zoopla, emphasizes the importance of presentation and pricing for sellers aiming to make a successful move in this more competitive landscape.

Overall, the indications from the housing market are uplifting, suggesting a sustained recovery that could foster a balanced environment for both buyers and sellers in 2026.