The green shoots of a recovery in the housing market at the start of 2026 support other evidence that suggests the economy has strengthened. We think further falls in mortgage rates and looser lending standards will allow house prices to rise by 3.5% in the year to Q4 2026, which would surpass most others’ expectations, and by 3.0% in the year to Q4 2027. Meanwhile, by exacerbating the tightness of the supply of rental properties, the tax on landlords announced in November’s Budget means we expect market rents growth to accelerate from 2.2% late last year to about 2.8% in 2026 and to 4.0% in 2027.
We’re hosting an in-person property roundtable event at our London office on 18th March to discuss the housing and commercial property winners and losers. (Register here.)
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