Budget uncertainty and worries about the future meant a quiet property market at the end of last year.
That seems to have changed. According to property website Rightmove, January delivered a record-breaking jump in asking prices and increased buyer activity. So, is this recovery going to set the tone for 2026, or is Rightmove’s optimism going to be sunk when the actual sold prices come in?
If you’re thinking about buying a home this year, understanding these changes could be vital.
A record start to the year?
The various indexes that report house prices vary in detail, but the overall direction seems to be clear.
Rightmove suggests that January has seen the largest month-on-month rise in asking prices ever for this time of year, with the average new-seller price climbing to £368,031, up 2.8% from December.
The Nationwide House Price Index for January 2026 saw house prices increased by 0.3% between December 2025 and January 2026, and the average UK house price now £270,873.
Some prices are now slightly higher than they were at this point last year. The market appears to have regained it’s footing following the volatility around the November Budget, and with estate agents reporting an increase in enquiries, it seems both buyers and sellers have returned with renewed confidence
Putting it into perspective
Asking prices have essentially returned to summer 2025 levels, before Budget rumours unsettled the market. This might suggest that the boom is actually a recovery to where the market was heading before confidence dipped.
What’s more, the figures are a UK average, and a closer look at the regional figures shows the recovery is not evenly distributed. Some regions have seen strong growth, while others are still below last year’s levels:
- North East: +3.4% year on year, with a 7% monthly rise
- Scotland: +1.7% year on year, despite a small monthly dip
- London: +0.9% year on year, with a 2.8% monthly increase
- East of England: –0.3% year on year
- South East: –1.6% year on year
Within the regions, there seems to be variation across sectors. First time buyers may be looking at prices that are still behind those of last year, while those moving on may have to pay more to do so.
Easier to afford?
Apart from the sense of relief that November’s budget was not as drastic as expected, the main driver for recovery is probably increased affordability. Mortgage rates have eased. The average two-year fixed rate now sits at 4.29%, down from 5.03% a year ago, and the cheapest deals for those with larger deposits are as low as 3.47%. These are the lowest typical rates seen since before the disruptive mini-Budget of 2022.
This drop could mean the average buyer, with a 20% deposit, could save over £100 per month compared with last year.
So is it time to buy?
According to Rightmove, the number of homes listed for sale is rising. As a buyer you may have more choice, and the chance to compare and negotiate.
But you might want to act sooner rather than later. Buyer demand is on the up, and there are signs that many will be keen to secure a home even before the traditional spring rush.
There may be little to be gained by waiting. Financial markets expect no further base rate cuts until the second quarter of the year, so mortgage rates are unlikely to fall any further for the next few months at least.
To be able to act fast, you need to know your budget, be clear about the kind of home you want, and have your mortgage in principle ready.
A call to us at Continuum could help you get an offer in principle and the most appropriate deal for you from the entire mortgage market.
If you want to buy a new home in 2026, call us today.
Record price jump: Housing market update January 2026 | Property news
Nationwide House Price Index for January 2026 – Industry Reaction | Estate Agent Networking
This article is intended for general guidance only and is based on the opinion of Continuum it does not constitute financial advice. Individual circumstances vary, and you should consider seeking advice from a regulated financial adviser before making any decisions about your mortgage planning.
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