What’s happening with UK house prices? Latest property forecasts for 2026
With mortgage rates creeping back up and ongoing market volatility, can we expect house prices to slide?
Sam Walker
Hopes for major house price growth in 2026 have been tempered by ongoing tensions in the Middle East.
Lenders and experts were optimistic about property prices at the start of the year with mortgage rates falling, but this positivity has diminished since the US and Israeli launched strikes on Iran on 28 February.
It has also stopped the Bank of England from dropping interest rates, as ratesetters grow fearful over the impact the war will have on inflation.
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That means borrowing money for a house is not set to get cheaper any time soon with mortgage rates from most major banks now far higher than in January 2026, before the war in Iran began.
So, how much can you now expect to pay for a house? We look at the latest data from the major house price indices, including Halifax, Nationwide and the Office for National Statistics (ONS) and Zoopla, as well as Rightmove for asking prices.
What is the current average house price in the UK?
While each house price index report varies, currently the average house price sits roughly between £270,000 and £300,000.
That said, these are UK average prices, and prices can vary dramatically depending on the region and methodology of each HPI.
HM Land Registry UK House Price Index
The most authoritative house price index is HM Land Registry 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.
The latest Land Registry data, for March 2026, shows the average UK house price is £268,132.
According to the data, house prices fell by 0.4% month-on-month and rose by less than 0.1% on an annual basis.
House prices in London continue to slide, falling by 2% between March 2025 and March 2026, from £553,812 to £542,065.
Nationwide House Price Index
The most recent Nationwide data suggests house prices rose by 0.6% in the month to April, up from £277,186 in March. After taking account of seasonal effects, Nationwide said prices rose by 0.4% month-on-month.
Nationwide puts the average UK house price at £278,880 as of April.
Robert Gardner, chief economist at Nationwide, said the market was proving resilient due to strong household finances and low debt relative to income.
He added: “Housing affordability had been improving steadily in recent years due to a combination of income growth outpacing house price growth by a wide margin and a modest decline in mortgage rates.
“While market interest rates have risen in recent months, the impact on affordability has so far been limited.”
Halifax House Price Index
The latest Halifax HPI shows the average UK house price fell by 0.1% between March and April to £299,313.
Analysis by Halifax suggests the drop in house prices was a result of the higher borrowing costs and lower consumer confidence caused by the Iran war.
The latest figures mean annual house price growth has slowed to just 0.4%.
It is the second consecutive monthly drop in house prices reported by the lender, coming after a 0.5% fall between February and March.
Rightmove House Price Index
Unlike Nationwide and Halifax’s HPIs, which are based on the building society and bank’s valuations at the mortgage-approval stage, Rightmove’s HPI is based on asking prices.
Rightmove found asking prices rose by 1.2% in the month to May, taking the average asking price to £378,304.
Rightmove said, despite cost pressures, the market was holding up relatively well, with sales agreed down 4% compared with May 2025, but up 2% compared to the same month in 2024.
Zoopla House Price Index
The Zoopla house price index uses sold prices, mortgage valuations, and data for agreed sales to calculate house prices for any given month.
According to Zoopla’s latest data, the average house price in the UK is £271,900 (as of April 2026), up fractionally from £271,700 in March.
Which UK regions are seeing the strongest house price growth?
The HPI data shows there are large variations in house price growth across the UK regions.
Zoopla’s latest HPI found annual house price growth is strongest across northern England, Scotland and Northern Ireland.
In Belfast, prices grew by 6.2% in the year to April 2026, 4.5% in Liverpool and 3.5% in Newcastle.
Across Northern Ireland as a whole, prices rose by 6.9% over the 12 month period. Prices rose by 3% in Scotland, 3.6% in the north west of England and 3.4% in the north east of England.
Annual price growth languished in southern England, with the south west seeing just a 0.1% rise in the year to April 2026, London 0% growth and prices in the south east actually fell by 0.2%.
Halifax’s latest data also shows how this regional divide is playing out, with Northern Ireland showing annual house price growth of 7.6% in the year to April while Scotland showed a 4% rise over the same period.
Conversely, the south east of England showed an annual fall of 2% in the year to April while London saw values drop by 1.4% over the same period.
How is the Iran conflict affecting confidence in the market?
As well as the five main HPIs released on a regular basis, the Royal Institution of Chartered Surveyors (RICS) also publishes a monthly Residential Market Survey.
The report 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.
RICS reports at the start of 2026 had suggested the housing market was showing positive signs, but now members are warning tensions in the Gulf are weighing down on the near-term outlook.
The April report noted a challenging market as expectations of higher interest rates dampen buyer confidence.
The house prices question recorded a net balance score of -34%, a drop from the -25% reading seen in the March report.
Meanwhile, when asked about agreed sales, RICS members reported a net balance score of -36%, down from -35% in March.
New buyer enquiries were more upbeat, recording a score of -34%, up from -40% the month before, but the report said this still pointed to weak momentum in the housing market.
Will house prices rise in 2026 and beyond?
At the start of the year, major lenders and estate agents were forecasting house prices to rise by up to 3% in 2026.
Estate agency Hamptons expected property values to grow by 2.5% by Q4, while Halifax forecasted they would edge up by between 1% and 3%.
However, the ripple effects of tensions in the Middle East have prompted some economists and analysts to review their forecasts for the year.
Economists at Pantheon Macroeconomics have adjusted their predictions for house price growth for 2026 from 3% to 1%.
Meanwhile, housing analysts polled by Reuters news agency in March forecasted property price growth of 2.5% in 2026, down from 2.8% in December.
Estate agent Knight Frank expects UK house prices to grow by just 1.5% in 2026, down from a prediction of 3% made in September 2025. It then forecasts prices to increase by 3% in 2027 and 4% in 2028.
How have mortgage interest rate changes impacted buyer affordability in the UK?
At the start of the year, many analysts hoped falling mortgage rates would help more people onto the property ladder.
Savills predicted the number of people buying homes between 2025 and 2030 will be boosted by falling mortgage rates while more relaxed affordability tests from lenders could boost transaction volumes.
But with mortgage rates rising to well above 5% on average since the outbreak of the Iran war in February, this could impact demand.
Data firm Moneyfacts says the average two-year fix is 5.73% (as of 28 May), up from 4.83% at the beginning of March.
