Market Overview
The UK housing market continues to rebalance as elevated stock levels coincide with softer buyer demand. While more properties are available for sale, reduced demand is translating into fewer agreed sales, longer transaction times and a greater proportion of listings requiring price reductions. Despite increasingly cautious house price forecasts, underlying affordability has improved in many areas, particularly outside the South East, which should help to support prices. Rather than significant price falls, weaker demand is currently having a greater impact on transaction volumes, as sellers remain reluctant to reduce asking prices substantially.
Key Facts
- Stock levels remain elevated, with new property listings up 2.7% year-to-date (YTD) compared with 2025.
- The up to £200,000 price band recorded the strongest supply growth, increasing 4.1% year-on-year.
- Buyer demand has fallen across every UK region, with the largest declines in:
- Northern Ireland: -20.8%
- Inner London: -10.4%
- Demand weakened further in May and June 2026, down 8.1%, which is expected to result in lower transaction volumes in Q4 2026.
- 38.4% of properties listed in 2026 have undergone at least one asking price reduction.
- Price reductions have become more common in the lower price bands and across the South (excluding Inner London), while easing in the North and Midlands.
- Fall-through volumes have decreased 10.6% year-on-year.
- 23.4% of completed sales in 2026 experienced at least one fall-through, continuing the improvement from the 2023 peak.
- Average time to sell has remained stable at 76 days, although properties priced above £1 million now take an average of 114 days to sell (+4.2% year-on-year).
- Average time to exchange has increased to 130 days, up five days compared with 2025.
- Sales agreed have declined across every UK region, highlighting broad-based market weakness:
- Scotland -2%
- Yorkshire & The Humber -3%
- East of England -4%
- North East -5%
- South East -5%
- South West -5%
- West Midlands -5%
- Outer London -6%
- East Midlands -6%
- Wales -6%
- North West -8%
- Inner London -8%
- Northern Ireland -35%
- Consensus forecasts for UK house price growth in 2026 have been revised down from 2.1% (March) to 0.8%, with some commentators now expecting modest price declines.
- However, London prices remain broadly unchanged from Q2 2022 (around £540,000) while average earnings have increased by approximately 20%, indicating affordability has improved.
- Affordability pressures remain less acute outside the South East, supporting the potential for continued price growth if economic conditions remain stable.
- Sellers continue to show price inertia, preferring to hold asking prices rather than accept significant reductions, resulting in lower sales volumes rather than widespread price falls.
Stock Levels:
These remains elevated, with supply of newly listed properties 2.7% higher year to date in 2026 than in 2025. All price bands have benefited from year-on-year supply growth with the up-to-£200,000 price band leading growth, with volumes increasing 4.1%.
Demand:
This has reduced in all UK regions year on year, with Northern Ireland down 20.8% year on year and Inner London down 10.4%. May and June 2026 saw notable demand declines of 8.1% and this is likely to feed through into weaker transaction levels in Q4 2026.
Asking Price Reductions:
Some 38.4% of listings so far this year have seen at least one price reduction. Broadly speaking, reduction rates in year-to-date 2026 have increased in the lowest price bands, while easing across higher price points. And reductions are increasing in the South (with the exception of Inner London) and reducing in the North and Midlands.
Fall Throughs:
We are seeing fall through volumes decrease substantially year on year by 10.6%. In 2026, 23.4% of completed sales had at least one fall through. Fall through rates have reduced since their peak in 2023.
Time To Sell:
The average number of days between listing and agreeing a sale has remained stable at an average of 76 days in year-to-date 2026. But the £1m+ segment stands out, with time to sell rising 4.2% year on year to 114 days.
Average Time To Exchange:
The average time to exchange in year-to-date 2026 was 130 days. This is a five-day increase year-on-year.
Sales Agreed:
Sales agreed across regions present a clear picture of weakening market conditions. The negative figures show that no region has been immune to the slowdown.
Scotland -2%
Yorkshire and The Humber -3%
East of England -4%
North East -5%
South East -5%
South West -5%
West Midlands -5%
Outer London -6%
East Midlands -6%
Wales -6%
North West -8%
Inner London -8%
Northern Ireland -35%
Many commentators have revised their forecasts for UK house price growth in 2026, with the median down from 2.1% (in March) to 0.8% now, with some now predicting a decline.
This seems unduly pessimistic given that London prices in Q2 2026 are the same average level as in 2022 Q2 at c£540,000, while average earnings are up by 20% over the same period, suggesting the downward adjustment may be over in the capital.
There is less strain on affordability outside the South East, suggesting further price growth while the economy is steady. In addition, sellers tend to anchor their pricing to what they previously paid or what the going rate is nearby and so tend not to drop prices to secure a sale.
The resulting inertia in pricing means sales tend to reduce when demand weakens.
