The property sales market has “the largest sales pipeline in four years” and it could grow further as two in five consumers either “watch” or “are in the market” to buy, Zoopla research boss Richard Donnell (pictured) has said.
But tight budgets, higher mortgage rates and increased moving costs continue to hold many back.
Donnell expects first-time buyers to be the main driving force within the market next year. They currently initiate 40% of all sales as lenders have increased income multipliers from 4.5x to 6.5x.
And, with rents now 35% higher than five years ago, buying is becoming comparatively more attractive for any tenants wanting to get onto the housing ladder.
Vendors must be realistic on pricing in 2026, if they want to attract buyers.”
The tougher challenge, he adds, will be getting second-steppers and upsizers moving again. Higher moving costs, especially Stamp Duty in southern regions, plus rising supply, mean “vendors must be realistic on pricing in 2026” if they want to attract buyers.
Zoopla is forecasting modest UK house price growth of 1–3% next year, with sales volumes holding steady at around 1.15m.
Structural shift
In lettings, Donnell said the market is undergoing a structural shift as accidental landlords continue to exit. He stressed, though, that it was not necessarily a negative for agents, as professional landlords now hold half of all rental stock and are more likely to use full management as regulations grow ever more complex.
He also notes that, although rising rents are “boosting agent revenues,” affordability has reached its limits in many areas. It means Zoopla is predicting rental inflation for new lets will moderate to 2–4% in 2026 and, with lower migration, supply and demand will be more in balance.