February is on course to record the highest number of new home listings for a decade according to the latest House Price Index from Zoopla.
There are currently 6% more homes for sale than a year ago, reflecting what the portal describes as improved seller confidence and a strong desire among households to move.
Zoopla expects supply to increase further in the coming months, which could help keep price growth in check.
At the same time, average mortgage rates for new loans have fallen to their lowest level in four years, with rates on both two- and five-year fixed deals now below 4% for the first time since 2022.
CHEAPER HOMES
Affordability testing has also eased, with lenders typically stress-testing at 6.5%, down from 8.5% a year ago. As a result, 40% of homes currently listed are cheaper to buy with a mortgage than to rent locally, assuming a 20% deposit – up from 25% last year.
House price growth remains subdued at 1.3% in the 12 months to January, compared with 1.8% a year earlier. Northern Ireland is seeing the fastest growth at 8%, while the North West leads Great Britain at 3.3%. London prices are 0.2% lower year-on-year, with southern England remaining the softest market overall.
GOOD NEWS FOR BUYERS
Richard Donnell (main picture, inset), Executive Director at Zoopla, says: “Despite improved levels of market activity, subdued house price inflation is good news for buyers and sellers and represents a more stable market. More sellers putting their home on the market shows a strong desire to move home.
“Now could very well be the best time to buy a home in recent years.”
“Lower mortgage rates and improved affordability of mortgages means now could very well be the best time to buy a home in recent years, especially for first time buyers with more homes available to buy for less than the cost of renting.
“We expect continued modest rates of price inflation over 2026 which will support healthy levels of sales with some wide variations across local markets. Sellers need to seek the advice of local agents to get the right strategy for their home.”
RENEWED CONFIDENCE
Nathan Emerson, CEO of Propertymark, says: “It is encouraging to see renewed confidence in the housing market, with more competitive mortgage rates and improved affordability checks helping more people step onto or move up the housing ladder.
“After years of cost-of-living pressures and higher interest rates, 2026 is showing signs of greater stability. With inflation dipping down earlier this month, it is hoped the Bank of England may have the confidence to bring the base rate down further when they next meet.
“At the same time, stronger price growth in parts of the UK outside London reflects changing working patterns and affordability considerations, as more people reassess where they can achieve a good standard of living.
“Rising house prices are not sustainable.”
Burt he adds: “However, rising house prices are not sustainable without a significant boost to the supply of genuinely affordable homes. Meeting housing delivery targets will be crucial to ensuring long-term affordability and preventing buyers from being priced out of areas seen as more attainable.”
IMPROVED RATES
Sarah Cartlidge, Branch Manager at Fraser Reeves, says: “We’re seeing multiple factors coming together, including improving mortgage rates and easing lending criteria to make a more healthy and confident sales market recently.
“There are plenty of new properties being listed since January and this continues to be the case as we move into Spring.”
FAVOURABLE ENVIRONMENT
Nigel Bishop, Founder of buying agency Recoco Property Search, says: “Not only has there been an uplift in buyer activity since the beginning of the year, we have also seen more sellers putting their home on the market.
“This is creating a highly favourable environment for house hunters with parts of the UK now boasting a more varied selection of properties to choose from. Whilst prices have seen a subtle increase, the uplift in homes for sale will allow more buyers to hold the upper hand during price negotiations.”
“We expect plans will be put on hold when the starting gun is fired on the Labour leadership race.”
Tom Bill, head of UK residential research at Knight Frank, said: “House prices are being kept in check by rising supply as plans delayed by last year’s Budget are activated and more landlords attempt to sell due to red tape.
“Buyers are more circumspect than sellers but further mortgage rate declines and increasingly realistic asking prices will support transactions this spring.
“The political noise hasn’t cut through to the mainstream housing market yet but we expect plans will be put on hold when the starting gun is fired on the Labour leadership race.”
