The UK housing market has kicked off 2026 with a dramatic surge, recording its most significant January price increase in over a decade. New data reveals a remarkable post-Christmas rebound, though experts caution that the landscape remains challenging for sellers.
The Boxing Day Bounce and Record Price Rise
According to the latest figures from the property portal Rightmove, the average asking price for a home in Britain leaped by just under £9,900 in the single month since December. This increase pushes the typical property value to £368,031. The monthly rise of 2.8% stands as the largest January jump in Rightmove's 25-year history of reporting. Furthermore, it represents the biggest month-on-month increase for any month since June 2015.
The company attributes this sharp recovery to a resurgence of confidence following Chancellor Rachel Reeves' Budget at the end of November 2025. Prior to that fiscal event, market activity was subdued by rumours and uncertainty, which dampened buyer and seller sentiment.
A Surge in Activity Meets a Glut of Supply
The festive period triggered a notable spike in market activity. Rightmove reported that buyer demand, measured by enquiries to estate agents, soared by 57% in the two weeks after Christmas Day. Simultaneously, the number of newly listed properties rocketed by 81% compared to the preceding fortnight.
This demand has been bolstered by a steady decline in mortgage rates, with several major lenders announcing headline-grabbing cuts at the end of 2025 and the start of this year. However, this positive news for buyers is tempered by a significant warning for those looking to sell.
Rightmove highlighted that the number of homes available for sale is currently at its highest level for this time of year since 2014, a twelve-year peak. Adding to the competitive environment, approximately one-third of properties already on the market have undergone a price reduction. The market is also described as "volatile," with regional disparities; while most areas saw prices climb in January, the East Midlands and Scotland experienced falls.
Expert Advice: Confidence Tempered by Realism
Colleen Babcock, a property expert at Rightmove, commented on the conflicting signals. "It’s an encouraging start to the year to see sellers confident enough to list their homes at higher prices after several months of muted price growth last year," she said. She noted that asking prices have merely returned to levels seen in the summer of 2025, before the pre-Budget rumours began.
However, Babcock issued a clear warning: "This new year seller confidence is a good sign, but sellers would do well to listen to the guidance of their agent... There’s a twelve-year high number of homes for sale, so buyers have lots of choice." She emphasised the need for sellers to be realistic and price their homes competitively to secure a buyer in a crowded marketplace.
Estate agents on the ground are witnessing the trends firsthand. Myles Moloney, director at Chase Buchanan estate agents in London, reported a very busy market. "We have also seen a big uplift at the start of this year in family home buyers who are moving for the second or third time," he said. "Many are keen to push on early in 2026 and secure their next step rather than wait for the spring market." He confirmed that well-presented, sensibly priced homes tailored to modern living are attracting the most attention from buyers empowered by improving mortgage affordability.
