Zoopla has given an upbeat assessment of the first month of the 2026 housing market.
The portal says buyers are returning as confidence improves and mortgage rates fall.
But a growing number of homes for sale is giving buyers more choice and reshaping market conditions.
Strong rebound in demand, but 9% down on last year
Buyer demand has rebounded since the beginning of the year following a quieter end to 2025, when many households delayed moving decisions amid uncertainty around the Budget.
Activity levels are now broadly in line with early 2024, although remain below last year’s unusually strong start, when buyers rushed to complete ahead of stamp duty changes.
Fierce competition in the mortgage market and lower mortgage rates are supporting confidence, says Zoopla.
The total number of homes for sale is 6% higher than last year, with agents marketing the largest number of properties seen in eight years.
This increase in supply is easing competition between buyers and placing greater emphasis on realistic pricing and good presentation from sellers.
UK house price increases 1.2% over 2025
Market conditions vary across the country.
The average UK house price increased by 1.2% over the last 12 months, increasing by £3,200 to stand at £269,800 at the end of 2025.
Prices have increased up to four times faster in more affordable parts of the Midlands, northern England, Scotland and Northern Ireland.
In contrast, smaller price falls of -0.1% were recorded across the South-East and South-West regions.
Buyers in southern England are more price-sensitive due to higher buying costs and a greater supply of homes for sale.
London now has significantly more homes on the market than a year ago, reinforcing a buyers’ market in the capital and pushing prices lower over 2025.
Outlook
More homes for sale means more buyers in the market.
This shows the desire to move home remains, but sellers must factor in local market conditions as they plan their move.
Zoopla expects current trends in market activity to continue over the early part of the year. There is good demand for homes that are well priced.
Expert view
Richard Donnell, executive director at Zoopla, says: “After a weak end to 2025, home buyer confidence is returning as mortgage rates ease and those who delayed decisions last year return to the market.
“The first few weeks have seen buyer demand fall short of the very strong start to 2025 when buyers were rushing to beat the stamp duty deadline.
“Market conditions vary across the country and are defined by the level of choice for home buyers.
“There are more homes for sale and more choice is welcome news for buyers, but sellers need to adapt to a more competitive market where pricing and presentation really matter for serious sellers looking to move in 2026.”
