07/08/2026
UK Property Market: Mid-Year Outlook 2026
Just over halfway through the year, the economic outlook has shifted considerably, with inflation, mortgage rates and geopolitical uncertainty continuing to influence the UK housing market.
Inflation expectations for 2026 have risen from 2.2% at the start of the year to around 3.4%, partly reflecting concerns around global supply chains and energy prices.
The Bank of England base rate is currently expected to remain at 3.75% for the rest of the year, while five-year mortgage rates are sitting at around 4.7%. Borrowing costs may remain elevated until some of the wider economic uncertainty begins to ease.
Despite this, earnings growth remains relatively resilient, helping household finances gradually recover.
Mortgage approvals have softened as some buyers delay their plans, but underlying demand remains encouraging, suggesting many are waiting for improved mortgage conditions before returning to the market.
House price growth forecasts have also been revised down, from 2.7% at the beginning of the year to 2.0%, although importantly, expectations remain positive.
For buyers and sellers, the market continues to reward realistic pricing, strong presentation and a well-planned marketing strategy.
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Source: Dataloft by PriceHubble, HM Treasury Consensus Forecasts December 2025 and July 2026, Bank of England.