The UK housing market is set to enter 2026 with renewed momentum after months of hesitation linked to speculation over property tax changes ahead of the Autumn Budget.

Zoopla expects around 1.15 million sales next year – broadly in line with 2025 – as buyers priced between £500,000 and £2 million return to the market following a period of uncertainty.

New figures from the property portal show the market closing 2025 with 1.15 million completions, up 4.5%on the previous year.

Competitive mortgage pricing and resilient buyer demand have supported activity despite economic pressures and cost-of-living constraints.

BUYER SHIFT

Data also points to a clear shift in buyer preferences over the past 12 months. Rural homes dominated online interest, while three-bed terraced properties remained the most searched-for type. Scotland continued to lead the UK’s fastest-moving markets, with Falkirk posting an average selling time of just 13 days.

Zoopla’s annual trends snapshot also highlights a divergence between regional affordability.

Kensington and Chelsea remains the UK’s most expensive local authority for buyers and renters, while Inverclyde and Hartlepool sit at the opposite end of the scale for house prices and rents respectively.

GREATER CONFIDENCE

Nathan Emerson, CEO of Propertymark, said: “While there are challenges that remain within the wider economy, it has been a year where the housing market has held its nerve and progressed forward.

“Many people are typically feeling a greater sense of confidence than only a year previous, and with inflation forecast to trend further downward over the coming months, we may see the Bank of England feel that much needed self confidence to further implement the downward journey for base rates.

“With the Autunm Budget also now behind us and with many people having a clearer picture of what the forthcoming months now looks like from a financial viewpoint; we hopefully should witness a positive start for the housing market as we head into early 2026.”

DEMAND KEPT IN CHECK

And Tom Bill, head of UK residential research at Knight Frank, added: “In a year when Budget speculation kept a lid on demand for most of the final six months, steady mortgage rates underpinned housing market activity.

“We expect rates to keep drifting lower in 2026 and sub-4% mortgages will become available across a wider range of loan-to-value deals.

“The tougher financial landscape for buyers after the Budget, including the income tax threshold freeze, will increasingly keep demand in check but the biggest near-term risk is political.

“Budget speculation could turn into conjecture about the occupants of Downing Street and their plans for the economy in the early months of next year.”