London’s housing market is entering a period of adjustment as we move into 2026. After several years of reduced activity caused by higher interest rates and affordability pressures, market analysts are now forecasting a more stable outlook for buyers and sellers across the capital.
London has experienced some of the lowest property transaction levels in over 20 years. Sales volumes dropped sharply during 2023 and 2024 as mortgage rates rose and buyer confidence weakened. This slowdown reduced market liquidity and limited movement across the housing ladder.
Lower transaction levels have also impacted stamp duty revenues and slowed overall market momentum, particularly in higher-value areas of the capital.
Property experts expect a gradual recovery in 2026 rather than a rapid rebound. Wage growth has begun to outpace house price growth, helping to ease affordability pressures for buyers. In addition, recent reductions in the Bank of England base rate are expected to feed through into lower mortgage rates, improving borrowing conditions.
Most forecasts suggest UK house prices could rise by around 2–4% during 2026. However, London is expected to underperform the national average due to its higher price base, with growth likely remaining in low single digits.
Flats, particularly in central London, may continue to lag behind houses, while family homes in outer London and well-connected commuter areas are expected to attract stronger demand.
New housing delivery remains a key challenge for London. Limited stock continues to place pressure on prices and competition for well-located properties, particularly those close to transport links.
If you are considering buying property in London or elsewhere in the UK, CHBL offers expert support throughout the entire buying process.
Browse our current selection of homes for sale, including properties across London and other key UK locations: https://www.chbl.uk/en/properties-for-sale/available
Our listings include options suitable for first-time buyers, home movers and property investors.
Our in-depth buying guides provide clear, practical advice on purchasing property in the UK, including:
Access our buying guides here: https://www.chbl.uk/en/buying-guides
London’s property market is expected to stabilise in 2026, supported by improving affordability and easing borrowing costs. While price growth is likely to remain modest compared with other UK regions, opportunities exist for buyers who are well-prepared and informed.
With expert guidance, access to quality properties and clear buying advice, CHBL can help you navigate the market with confidence.
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