The housing market has kicked off the new year with a strong surge following a remarkable increase in prices. According to property website Rightmove, the average home has seen a substantial rise of nearly £9,900 to reach £368,031 since December. This 2.8% spike represents the largest January increase in Rightmove’s 25-year history and the most significant month-on-month surge since June 2015.
Rightmove attributes this market rebound to Chancellor Rachel Reeves’ Budget at the end of November, which dispelled previous rumors and uncertainties that had dampened activity. Despite this positive momentum, Rightmove cautions potential sellers about the challenging market conditions. The number of homes available for sale is at its highest level for this time of year since 2014, with a third of listed properties experiencing price reductions. Market conditions vary widely across regions, with notable declines in the East Midlands and Scotland amid overall price increases in most areas.
Buyer demand has been robust, with a 57% surge in inquiries to agents and an 81% increase in newly listed homes for sale in the two weeks post-Christmas. This demand has been supported by decreasing mortgage rates, following significant rate cuts by major lenders at the end of 2025 and the beginning of 2026.
Colleen Babcock, a property expert at Rightmove, expressed optimism about sellers listing their properties at higher prices this year, reflecting increased buyer interest. However, Babcock advises sellers to heed their agents’ guidance when setting prices to avoid overpricing, given the current market dynamics. Myles Moloney, director at Chase Buchanan estate agents in London, noted a busy market with a focus on family-friendly homes featuring spacious kitchens and living areas. The market trend indicates an early surge in family home buyers seeking well-priced, modern properties, driven by improved affordability and attractive presentation.
The current market environment emphasizes the importance of realistic pricing and property presentation to attract buyer interest effectively.