Property Market Update | February 2026
Early-Spring 2026 Update — time to get your ducks in a row
Momentum is building into spring. Prices are edging up, asking prices just jumped, stock is plentiful, mortgage rates have steadied, and sentiment indicators are turning more positive. All the ingredients for a buoyant March–May window.
What the latest numbers say
After a softer end to 2025, January saw house prices up 1.0% year-on-year and 0.3% month-on-month, according to Nationwide Building Society’s index, the strongest annual rise since November. Halifax’s December release showed a small monthly dip but positive annual growth, underlining a market that’s stabilising rather than surging. Inflation ticked higher in December but remains well below 2023 peaks.
Seller confidence has also reawakened: new seller asking prices leapt 2.8% in January to £368,031, (the biggest January rise on record), while available stock is the highest for this time of year since 2014, so buyers have more choice than they’ve had in years.
On activity, December mortgage approvals for house purchase dipped to 61,000, a pause that fits with the pre-Budget lull late last year. Forward-looking sentiment, however, improved into January, with surveyors reporting better sales expectations despite demand still slightly negative on balance.
Rates and affordability
The Bank Rate sits at 3.75%, with markets and commentators expecting the Bank of England to hold this week and consider modest cuts later in 2026, subject to inflation progress. Average 2-year fixed mortgage rates are ~4.27% and 5-year fixes ~4.37% (with the lowest headline deals below 3.7% for strong applicants), supporting improved affordability versus a year ago.
For first-time buyers, lender innovation continues: Santander UK has launched a 98% LTV five-year fix with strict criteria — a sign of confidence at the low-deposit end of the market.
Supply, demand and regional colour
Stock levels have reset higher after many late-2025 withdrawals were relisted in January. Homes for sale are at an eight-year high, while buyer demand has rebounded from the autumn slowdown, a combination that points to healthy but price-sensitive trading conditions this spring.
Regionally, 2025 closed with a gentle north–south tilt to price growth (North West and Scotland ahead of southern regions), and early-2026 commentary suggests that trend could persist as affordability ceilings bite in higher-priced areas. Use local comparables carefully when setting asking price.
Our spring outlook (March–May)
Pricing: With asking prices already up and more stock on the market, buyers will still punish over-pricing. Right-sizing your guide price to local evidence will protect time-to-sell and reduce the likelihood of mid-campaign reductions.
Activity: Expect higher listing and viewing volumes as daylight, weather and family timelines drive decisions. Surveyor expectations have improved, which typically foreshadows stronger agreed sales as we move through March and April.
Finance: Rates are materially lower than a year ago and relatively stable. If Bank Rate falls later in 2026, that’s a bonus; don’t bank on it. Secure an Agreement in Principle early to compete decisively when the right home appears.
Macro watch: Keep an eye on inflation releases from the Office for National Statistics; benign prints will help keep rate expectations anchored, supportive for spring momentum.
Get your ducks in a row: practical steps for sellers
Price with precision. Start with recent completions and near-identical comparables, then sense-check against current competing stock. In a market with more choice for buyers, accuracy trumps ambition.
Stage for spring. Light, greenery and kerb appeal convert viewings into offers. Fresh paint on scuffed woodwork, pre-emptive garden tidy-ups and swapping heavy textiles for lighter layers instantly “spring-ifies” photos and first impressions.
Professional photography and floorplans. Book shoots on bright mornings; ask for dusk externals if your property features good exterior lighting.
Fix the friction. Service the boiler, gather FENSA and electrical certificates, locate guarantees and planning permissions. A clean legal pack cuts fall-through risk once offers land.
Line up your next move. If you’re upsizing, a broker can map products to your affordability and timescales. Consider porting versus redeeming; explore product transfers alongside remortgages to keep options open.
Choose launch timing wisely. Target late-week listing to capture weekend search traffic; early March is often a sweet spot before Easter holidays create diary clashes.
Plan for chain resilience. Pre-empt common delays (management packs, searches, gifted deposits). Agree milestones with your conveyancer at instruction, not at offer.
Buyers: how to be offer-ready
AIP and proof of funds on file before first viewings.
Shortlist conveyancers and compare quotes now; instruct on offer day to steal a march.
Know your ceiling. With more stock, the best homes still go quickly — be clear where you’ll stretch and where you’ll walk away.
Consider flexibility on completion dates to win competitive situations without overpaying.
The bottom line
We’re heading into spring with rising prices at the margin, record January asking-price momentum, plenty of stock, steady (and improved) mortgage pricing, and improving sentiment, a recipe for a busy, but still price-sensitive, market. If you plan to sell or trade up in 2026, preparation in February will put you front of the queue when activity peaks in March and April.
Sources: Rightmove House Price Index (19 Jan 2026); Zoopla House Price Index and press releases (Jan 2026); Royal Institution of Chartered Surveyors UK Residential Market Survey (Jan 2026); Office for National Statistics CPI bulletin (Dec 2025); Bank of England Bank Rate and Money & Credit (Dec 2025); Nationwide Building Society HPI (Jan 2026); Halifax HPI (Dec 2025).
