Property market forecasts are most useful when they are treated as informed estimates rather than precise predictions, and when they are understood alongside the assumptions that underpin them. Forecasts published at the start of 2026 were based on a different economic backdrop to the one that exists today.
Since then, geopolitical events, higher borrowing costs and increased political uncertainty have prompted many forecasters to revise their expectations. Understanding what has changed, what remains consistent and where uncertainty still exists provides buyers and sellers with a more balanced basis for decision-making than relying on a single headline forecast.
What the forecasts looked like at the start of the year
At the beginning of 2026, most major housing market commentators expected modest house price growth across the UK.
Rightmove forecast a 2% increase in asking prices, while Nationwide anticipated annual house price growth of around 2% to 4%. Halifax expected growth of 1% to 3%. These forecasts were based on expectations that affordability would gradually improve during 2026 as mortgage rates eased, earnings continued to grow and buyer confidence strengthened.
How the outlook has changed
Since then, the economic backdrop has become more challenging. Higher borrowing costs, geopolitical tensions and wider political uncertainty have all weighed on buyer confidence.
Mortgage rates increased during the spring, reaching around 5% in April before beginning to ease again as swap rates settled and competition between lenders increased. While the Bank of England kept Bank Rate at 3.75% in June, mortgage pricing has continued to be driven primarily by wholesale funding costs and lender competition rather than the base rate alone.
As a result, several forecasters have revised their expectations for house price growth during 2026.
RSM UK now expects UK house prices to increase by around 1% to 2% during 2026, compared with earlier expectations of around 4%. Zoopla's latest House Price Index reports that the average UK house price is now £271,900, representing annual growth of 1.4%, while Nationwide recorded annual house price growth of 2.2% in June.
Together, these figures suggest that the housing market remains resilient, although growth is more modest than many expected at the beginning of the year.
The medium-term picture
Although the short-term outlook has softened, most commentators continue to expect the housing market to remain supported by long-term fundamentals including limited housing supply, continued household formation and gradually improving affordability.
RSM UK expects house prices to grow by around 22% between now and 2030, although it notes that the pace of growth will depend on inflation, interest rates and wider economic conditions. Borrowing costs are expected by many commentators to begin easing during 2027, although the timing will depend on future inflation and monetary policy decisions.
Nationwide has also noted that the housing market has remained relatively resilient despite higher borrowing costs. Combined with earnings growth continuing to outpace house price growth, improving affordability should provide ongoing support for buyer demand over the medium term, provided economic conditions remain stable.
What forecasts cannot tell you
No forecast can tell you what a particular property on a particular street will sell for. National averages are made up of thousands of local markets, all moving at different speeds.
Regional performance continues to vary significantly. Northern Ireland remains one of the UK's strongest-performing markets, while many parts of northern England continue to record stronger price growth than London and the South East, where affordability pressures remain greatest.
For buyers and sellers, national forecasts provide useful context, but recent comparable sales, local supply levels and current buyer demand remain the most reliable indicators of market value.
Forecasts provide direction. Local market evidence provides the answer.
Talk to our team about your local market today