In a recent report from Rightmove, the average asking price for homes across the UK has experienced a slight decline of £12 in February, settling at £368,019. This follows a remarkable surge of nearly £10,000 in January, marking a significant shift in the property market. Despite this marginal decrease, the early months of 2026 have shown the strongest start in house prices since 2020, leaving many to ponder the implications for buyers and sellers alike.
A Record Surge Followed by Stabilisation
January 2026 witnessed an unprecedented rise in house prices, with an increase of £9,893—the largest recorded by Rightmove in 25 years during that month. This explosive growth was largely attributed to renewed buyer confidence following a period of uncertainty surrounding the autumn budget and the typical seasonal slowdown that follows Christmas.
Colleen Babcock, a property expert at Rightmove, encourages a contextual understanding of February’s figures. “Virtually flat prices in February really need to be viewed alongside what happened in January,” she explained. The cautious approach taken by sellers in February reflects a desire to maintain the gains achieved in January, particularly as competition in the market remains high.
Signs of a Strengthening Market
Looking at the broader landscape, the current market appears to be strengthening compared to two years ago. Newly listed properties have increased by 11 per cent since 2024, alongside a 9 per cent rise in sales agreed. Babcock suggests that 2026 could offer a more favourable scenario for buyers, as average wages have risen by approximately 17% over the past three years, significantly outpacing the modest increase of 1.5% in property prices.
Matt Smith, a mortgage expert at Rightmove, highlights the positive impact of regulatory changes on borrowing. The Financial Conduct Authority’s review of loan-to-income caps and encouragement of flexible stress testing have enabled typical buyers to secure larger loans, facilitating greater access to the housing market.
Improving Conditions for Buyers
Local agents are echoing the sentiment that conditions are becoming more advantageous for buyers. Craig Webster, managing director at Tiger Sales & Lettings in Blackpool, notes a shift in sellers’ mindsets as they become more realistic about pricing amidst high competition. “Demand remains resilient,” he stated, adding that those who are prepared and decisive will likely find themselves in the strongest position as the bustling spring market approaches.
Katie Griffin, director at Sawdye & Harris in Dartmoor, also anticipates increased activity in the spring, provided that sellers price their homes sensibly. “There’s genuine buyer demand out there—people have just been waiting for the right moment and the right property at the right price,” she remarked.
The Bigger Picture: Housing Market Value
In a related analysis, property firm Savills reported that the total value of homes in the UK has reached an astonishing £9.18 trillion, a figure that encompasses outright ownership, mortgaged properties, social housing, and the private rental sector. While the total value rose by £136 billion in 2025, it represented a significant drop compared to the £268 billion growth observed the previous year.
Lucian Cook, head of residential research at Savills, noted that the capital appreciation of £336 billion since the end of 2022 has been the slowest for a three-year period since 2013. Rising mortgage costs and a general slowdown in the housing market’s response to recent Bank of England rate cuts have contributed to this stagnation, particularly in London and the South East.
Interestingly, the North of England and the devolved nations, despite comprising only 27 per cent of the UK’s total housing value, have accounted for a remarkable 60 per cent of the total growth since 2022. The North West, in particular, has emerged as the leading region, witnessing a £63 billion increase in its housing stock value.
Why it Matters
The recent fluctuations in house prices and the evolving dynamics of the UK property market are critical for both buyers and sellers. With rising wages and improved lending conditions, 2026 could represent a pivotal year for homebuyers seeking their first properties or looking to relocate. Additionally, understanding regional differences in market performance is essential for stakeholders aiming to navigate the complexities of this ever-changing landscape. As the spring selling season approaches, the decisions made now could have lasting implications for the future of homeownership in the UK.
