Housing markets across Scotland and northern England are poised to deliver the strongest house price growth next year while much of southern England and London continue to lag as higher borrowing costs and tax burdens weigh on demand, according to new analysis from Zoopla.

The property portal has ranked 120 UK postal areas using a blend of market indicators, including affordability, time taken to sell, the scale of asking-price reductions and the proportion of homes that have been on the market for more than six months.

The results point to a clear north–south divide as the market heads into 2026.

Scottish locations dominate the top of the table, with the Motherwell (ML) postal area taking the number one spot in the UK.

Four other Scottish markets feature in the top nine, with Wigan in Greater Manchester the only non-Scottish location to break into that group.

Zoopla said these areas are characterised by relatively low levels of unsold stock, meaning fewer forced price cuts and stronger conditions for price growth.

AROUND THE REGIONS

Across England, the best prospects are concentrated in the North West and the Midlands. Wigan leads the English rankings, followed closely by Liverpool and Stoke-on-Trent, while North West towns and cities account for six of the top ten places overall.

These markets benefit from a combination of lower-than-average house prices and proximity to large employment centres, which keeps demand resilient even as mortgage rates remain higher than in the pre-pandemic era.

By contrast, housing markets across southern England, including London, occupy the bottom of Zoopla’s league table.

AFFORDABILITY STRETCH

The analysis points to stretched affordability and the ongoing adjustment to higher mortgage rates and property taxes as the main drags on performance, with many southern regions already seeing single-digit annual price falls.

Several parts of the capital – including West Central, West, East Central, South West and North West London – sit at the very bottom of the rankings.

These areas have a combined average property price of £711,140 and much longer selling times, with West Central London in particular taking more than twice the UK average of 39 days to find a buyer.

Zoopla said value is gradually returning to London after a decade of below-average price growth, and while the capital remains under pressure in the short term, improved affordability and slower price inflation are beginning to create opportunities for buyers prepared to look for value in 2026.

NOT A ONE-SPEED MARKET

Alex Rose (main picture, inset), commercial director at Zoopla, said: “This data brings into sharp focus that there isn’t a one-speed national property market, with conditions varying significantly across the country.

“In places like Scotland and the North, sellers are benefiting from strong demand and faster sales, while in many Southern markets, success is more dependent on setting a competitive asking price to attract increasingly selective buyers.

MOVING TO THE RHYTHM

And Kevin Shaw, national sales managing director, LRG, added: “This report captures the north – south story well. The point isn’t that one part of England is ‘winning’ – it’s that markets move to different rhythms.

“Many northern markets haven’t been on the same roller coaster as parts of the south. Property prices often rise in a steadier way in the good years so they tend to fall less when sentiment turns. The temperature is generally more consistent.

“By contrast, the south can overheat – and it can also catch a cold. Higher values can mean greater sensitivity to mortgage rates, affordability and confidence. That can translate into a longer adjustment period, even while demand for the right homes remains resilient.”