July 8, 2026
Summer housing market snapshot
| House price performance varies significantly across regions, with northern areas outperforming parts of the south | Borrowers are increasingly favouring tracker and shorter-term fixed mortgages amid rate uncertainty | Market activity remains steady, although affordability and pricing sensitivity continue influencing buyer decisions |
As we enter the summer months, the UK housing and mortgage markets are showing a mix of resilience and recalibration, with both buyers and lenders responding to evolving market conditions.
House prices and regional divergence
Data1 shows that the average asking price reached £378,304 in May, a 1.2% uplift in the month, continuing momentum seen earlier in the year. However, this masks a more subdued annual picture, with prices down slightly by 0.3% compared to a year ago.
A clear north–south divide continues to shape the market. More affordable regions such as the North East and North West are still seeing annual price growth, while London and the South East have recorded declines.
Scotland also stands out in this regional story. Savills highlights parts of Scotland among the strongest performers earlier this year, with some areas seeing growth of over 7%, although more recent data2 points to a moderation in momentum, with average monthly prices in Scotland edging down by around 0.45% so far in 2026.
Mortgage trends and shifting preferences
In the mortgage market, rising and volatile rates have prompted a notable shift in borrower behaviour. Demand for variable and tracker mortgages has more than doubled in just over six months3, as borrowers weigh the possibility of rates easing in the near term. At the same time, shorter‑term fixed deals have grown in popularity, while five‑year fixes have fallen out of favour as borrowers remain cautious about locking in at higher rates.
Looking ahead
The outlook for mortgage rates remains uncertain. While some lenders have cut rates, forecasts suggest progress may be uneven, with inflation and global events continuing to influence pricing.
Overall, the market remains active but more price‑sensitive, with regional differences and borrower caution likely to define the second half of the year.
1Rightmove 2026, 2YOPA 2026, 3Moneyfacts 2026
As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments.
