The UK housing market may be heading for a modest rebound in 2026, with forecasts pointing to house price growth of up to 4%. Falling interest rates and easing affordability rules are key factors behind the optimistic outlook.
Property analysts believe that gradual income growth will begin to outpace house price increases, making homeownership slightly more achievable for many households.
With the current average house price near £273,000, even a small percentage rise would push values higher nationwide. However, experts stress that growth is expected to remain controlled rather than overheated.
Mortgage costs have already started to decline, with fixed-rate deals becoming more competitive. This trend is likely to continue as lenders respond to lower base rates.
Regulatory changes are also underway, aiming to simplify mortgage rules and better reflect modern working patterns, including self-employment and variable incomes.