The UK housing market is showing clear signs of recovery in early 2026, with supply rising and increased activity from buyers and sellers across the country.
Homes for Sale Up Year-on-Year
Data from property portal Zoopla reveals that the number of homes available for sale in the UK has risen by 6% compared with the same period last year — marking a notable increase in housing supply. This surge means February is on track to have the highest number of new property listings in a decade, a trend that brings more choice to prospective buyers.
Lower Mortgage Rates Boost Affordability
One major driver behind this uptick in listings and buyer interest is the recent decline in mortgage rates. Both two-year and five-year fixed mortgage deals are now often below 4%, the lowest levels seen in around four years. Combined with eased affordability assessments by lenders, this shift has made it easier for many households — especially first-time buyers — to secure finance for a home.
According to Zoopla’s data, an estimated 40% of homes currently on the market are now cheaper to buy with a mortgage than to rent, based on typical deposit scenarios — a dynamic that is reshaping the balance between renting and buying for many UK households.
What This Means for House Prices
While supply is growing and more property choices are becoming available, the increase in homes for sale is expected to moderate house price growth in 2026 rather than spark rapid inflation. Industry analysts suggest that this broader supply lens gives buyers greater negotiating power and could keep price rises restrained over the year.
House price inflation for 2025 remained modest, with average UK prices increasing by around 1.2–1.3%, depending on the index referenced. Regional variations persist, with some areas showing stronger growth than others.
Buyer Confidence and Market Conditions
The increase in available homes reflects improving confidence among sellers and renewed activity in the market. However, affordability still presents challenges for many — particularly younger buyers struggling with deposit formation amid high living costs, despite more favourable mortgage pricing.
Summary: What Investors and Buyers Should Know
For property investors and buyers in the UK in 2026:
- More listings = more choice: Housing supply is up year-on-year, easing competition in some segments.
- Mortgage affordability is improving: Lower rates and lender flexibility are helping more buyers onto the ladder.
- Price growth remains subdued: With increased supply, rapid house price inflation is not expected in the near term.
- Local market conditions matter: Regional dynamics vary, so buyers and sellers should analyse local trends before acting.