This month is on course to be the best February for new estate agent listings for 10 years, according to the latest Zoopla HPI.
There are 6% more homes for sale than a year ago, and Zoopla expects the number to rise further in the coming months, keeping a check on rising prices.
Cheaper to buy
The portal says that combined with falling mortgage rates, the market is currently looking particularly good for first time buyers, with 40% of homes for sale now cheaper to buy with a mortgage than rent.
Average mortgage rates for new loans are at their lowest level for 4 years. Rates on both two-year and five-year fixed deals are now below 4% for the first time since 2022.
Stress test
Lenders are typically ‘stress testing’ that borrowers can afford a mortgage rate of 6.5%, lower than 8.5% a year ago.
This means that 40% of homes currently for sale on Zoopla are cheaper to buy with a mortgage than the cost of renting locally, assuming a 20% deposit.
Despite the increase in market activity, house price growth remains subdued at 1.3% growth (12 months to January) compared to a year ago.
Now could very well be the best time to buy a home in recent years.”
Richard Donnell, Executive Director at Zoopla, says: “Despite improved levels of market activity, subdued house price inflation is good news for buyers and sellers and represents a more stable market.
“More sellers putting their home on the market shows a strong desire to move home,” he says.
“Lower mortgage rates and improved affordability of mortgages means now could very well be the best time to buy a home in recent years, especially for first time buyers with more homes available to buy for less than the cost of renting.”
Industry reaction
The agents
Sarah Cartlidge, Branch Manager at Merseyside agent Fraser Reeves
“We’re seeing multiple factors coming together, including improving mortgage rates and easing lending criteria to make a more healthy and confident sales market recently.
“There are plenty of new properties being listed since January and this continues to be the case as we move into Spring.”
Tom Bill, Head of UK Residential Research at Knight Frank
“House prices are being kept in check by rising supply as plans delayed by last year’s Budget are activated and more landlords attempt to sell due to red tape.
“Buyers are more circumspect than sellers but further mortgage rate declines and increasingly realistic asking prices will support transactions this spring,” he says.
The political noise hasn’t cut through to the mainstream housing market yet, but we expect plans will be put on hold when the starting gun is fired on the Labour leadership race.”
The industry leader
Nathan Emerson, CEO at Propertymark
“It is encouraging to see renewed confidence in the housing market, with more competitive mortgage rates and improved affordability checks helping more people step onto or move up the housing ladder.
“After years of cost-of-living pressures and higher interest rates, 2026 is showing signs of greater stability,” he says.
With inflation dipping down earlier this month, it is hoped the Bank of England may have the confidence to bring the base rate down further when they next meet.”
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