UK house prices ‘could rise by up to 4% in 2026 as interest rates fall’

UK house prices are predicted to rise by 2-4% in 2026, according to Nationwide, due to anticipated income growth outpacing house price increases and a modest decline in interest rates. The average UK house price was £272,998 in November, and a 4% rise would bring it to £283,918. The Bank of England is expected to cut interest rates, further supporting the property market. The Financial Conduct Authority (FCA) announced plans to assist first-time buyers and self-employed individuals, and has also addressed concerns about mortgage stress tests potentially restricting access to affordable mortgages, leading some lenders to reduce their stress test interest rates. Other forecasts, including those from Rightmove and Halifax, also suggest price increases in 2026, albeit with varying estimates.

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