Zoopla’s latest House Price Index shows that the UK housing market is maintaining steady sales activity despite growing uncertainty over events in the Middle East. Higher mortgage rates associated with these stresses are impacting buyer demand.
While transactions continue to occur, the market is becoming increasingly dependent on a small group of committed buyers, as some families delay moving. This is widening the gap between weak overall demand and relatively stable levels of agreed sales.
Table 1: Difference between consent to sale and home buyer’s enquiry.
Data from Zoopla shows that buyer demand during the first three months of 2026 has been below last year’s levels. In March, inquiries were down 13% from a year earlier, reflecting the impact of events in the Middle East and a more cautious, “wait and see” approach among potential buyers. Average mortgage rates rose 0.4 percentage points during the month, and many deals under 4% were withdrawn as markets and buyers adjusted to uncertainty around inflation.
Despite weak demand, consensus sales have remained relatively stable, declining only 2% year-on-year. This is driven by mortgage offers from buyers or a clear need to relocate, which continues to support transaction levels.
Fewer buyers, but more motivated movers supporting the sale
This gap between buyer demand and consensus on more stable sales is visible across the country. Buyer inquiries have declined between 7% and 19% year-on-year, with the largest declines in active buyers recorded in the North East and West Midlands, although inquiries are falling from a high base compared to last year.
Table 2: The gap between sales consents and buyer inquiries across countries
Meanwhile, agreed sales are rising more steadily, again from a high base, with a more modest decline in the northern areas of England. In contrast to buyer demand, agreed sales are flat or slightly higher in some areas such as Wales, Yorkshire and the Humber and London compared to last year.
At the same time, the total number of homes for sale has increased by 6% year on year, reflecting a continued desire to relocate among homeowners despite a more uncertain backdrop.
A significant portion of transactions are also less sensitive to rising mortgage rates. About a quarter of sales are cash purchases, while many existing homeowners have built equity and secured borrowing in advance, reducing the impact of high mortgage rates. This is helping to support sales in the short term, but also highlights the increasing reliance on low mortgage-rate sensitive buyers.
House price growth remains stable
Overall, UK house price inflation remains stable at +1.3% year-on-year, with recent weakness in buyer demand having no immediate impact. Price trends remain uneven across the country. Growth is strongest in more affordable areas, with the North West recording an annual increase of 3.5%, although price declines in southern England have slowed in recent months despite a softening of demand.
Zoopla does not expect house price growth to slow in the near term, although this depends on demand remaining stable in the coming months. The pricing impact will require a more sustained decline in buyer activity and sales volumes meaning the current growth rate will continue.
Table 3: House price inflation % year-on-year to February 2026
Richard Donnell, executive director of Zoopla, said: “The market remains active, but increasingly dependent on a small group of serious buyers. Some early-stage buyers are taking a wait-and-see approach, but there is a large group of committed buyers who are making the move to purchase a home.
“If mortgage rates stabilize at current levels we expect sales activity to remain good compared to last year. Further increases in borrowing costs could weaken demand and impact sales volumes at the end of the year. The outlook is not clear, although we can see that demand has stabilized in recent days.
“For buyers, there is less competition and more choice, but affordability is becoming more affordable. For sellers, homes are still selling, but buyers are more selective and price-sensitive. Setting a realistic asking price with the help of a local agent will be key to ensuring a sale.”