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What’s happening with UK house prices? Latest property forecasts for 2026
The UK housing market continues to struggle as higher mortgage rates brought on by the Middle East conflict pinch buyers.
The UK housing market has been sluggish this year as geopolitical tensions have harmed affordability and stunted house price growth.
The Iran war, which began on 28 February, caused a global economic shock. In the UK, it has led to increased inflation and higher mortgage rates for consumers.
According to financial data firm Moneyfacts, the average two-year fixed-rate mortgage deal is 5.97% as of 30 October, up significantly from 4.83% on 27 February, the day before the war broke out.
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Robert Gardner, chief economist at Nationwide, said: “Market activity and house price growth have slowed in recent months, in part reflecting the uncertain economic backdrop. Geopolitical tensions remain high, with the conflict in the Middle East exerting upward pressure on energy prices, fanning inflation concerns.
“This in turn has led to mounting financial market expectations of Bank Rate increases, which have maintained upward pressure on the market interest rates which underpin mortgage pricing.”
How much can you expect to pay for a house?
House price indices (HPI) give a useful snapshot of where the housing market is at the moment and where it may be going in the near future.
As each HPI report uses a different dataset, their estimation of average house prices will differ, but on the whole the average UK house price is roughly between £273,000 and £299,000.
Bear in mind that these are UK-wide averages and prices can vary dramatically by region.
HM Land Registry UK House Price Index
The average price of a UK home was £273,037 in August 2026, up 0.3% from its July level of £272,611, according to the latest house price index from HM Land Registry, published in October .
House prices were 0.9% higher compared to their price in August 2025.
HM Land Registry’s house price index is the most authoritative in the UK as its data includes cash purchases as well as homes financed through a mortgage.
Its data is published on a six-week time lag, making it more retrospective than other house price indices.
Nationwide House Price Index
The average UK house cost £273,566 in October 2026, according to Nationwide’s latest house price index.
The data showed annual house price growth slowed to 0.5% in October, the slowest pace since January 2024.
Lloyds House Price Index
The latest Lloyds house price index shows the average UK house price is £298,441 as of September 2026, marginally up from £298,395 in August 2026.
The index is the longest-running in the UK, and was previously called the Halifax house price index, before being renamed earlier this year when Lloyds retired the Halifax brand.
Rightmove House Price Index
The house price indices already listed are based on the bank or building society’s valuation at the mortgage-approval stage, but Rightmove’s uses a different metric.
Rightmove’s HPI looks at average asking prices. This gives an indication of where house prices are set to go in the near future rather than where they are now.
As people tend to list their houses for more than they end up selling for, Rightmove’s HPI tends to track higher than other indices.
According to Rightmove, asking prices rose by 1% between September 2026 and October 2026, from £367,440 to £371,015.
Zoopla House Price Index
The Zoopla HPI uses sold prices, mortgage valuations and data for agreed sales to calculate house prices for any given month.
Zoopla puts the average UK house price at £273,100 as of September 2026, the same as the previous month and up just 0.8% in the last year.
How much confidence is there in the market?
As well as the five main house price indices, the Royal Institute of Chartered Surveyors (RICS) also publishes a monthly UK Residential Market Survey.
The survey generates net balance scores between -100 and +100 in response to a series of questions put to its members (estate agents and surveyors) about how the housing market has changed for better or worse.
The latest survey, covering the month of September 2026, reveals that interest rate rise expectations have stalled optimism which was growing over the summer.
The agreed sales metric dropped from -16% to -18% between August and September, while new buyer enquiries fell to -22%, down from -18% in August.
Meanwhile the headline house price measure slipped to -32% from -28% over the same period, breaking a run of four consecutive months of rises.
Respondents to the latest survey also recorded a net balance score of -24% over near-term house price expectations.
Will house prices rise in 2026 and beyond?
Estate agents, lenders and economists are generally more negative about where UK house prices are going in 2026 and beyond than they were at the start of the year, due to the outbreak of tensions in the Middle East in February 2026.
Economists at Pantheon Macroeconomics previously forecasted UK house prices would rise by 3% in 2026, but now expect them to flatline.
Estate agent Savills is forecasting a 2% drop this year, while Knight Frank’s latest predictions suggest property prices will rise by 1.5% in 2026.
Zoopla has said house price growth will slow to 0.5% by the end of the year, down from a previous prediction of 1%.
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