The UK housing market has entered the traditional summer slowdown, but this year seasonal factors have been amplified by unusually hot weather, the World Cup and ongoing global economic uncertainty. While activity has softened, the market remains remarkably resilient, with buyers continuing to move when properties are priced correctly and mortgage affordability remains manageable.

Summer Distractions Temper Market Activity

According to Rightmove’s latest House Price Index, the average asking price of a newly listed property fell by 1.0% in July to £372,359. While a dip in July is normal, this year’s reduction is significantly larger than the long-term July average of 0.2%. Rightmove attributes much of this to a combination of summer holidays, hot weather, the World Cup and political change, all of which have diverted attention away from house moving decisions.

Interestingly, Rightmove’s analysis found that periods of extreme heat temporarily reduced buyer demand before activity rebounded once temperatures cooled. Despite these short-term distractions, nearly three-quarters of homes that have successfully sold in 2026 achieved a sale without requiring a price reduction, highlighting the importance of sensible initial pricing.

What Are Rightmove and Zoopla Saying?

Both Rightmove and Zoopla are reporting a softer market than last year, although neither suggests a significant downturn.

Rightmove reports:

  • Sales agreed during the first half of 2026 were 6% lower than the same period in 2025.
  • The number of homes available for sale remains close to a 12-year seasonal high.
  • Buyers have greater choice and stronger negotiating power.
  • Sellers who price realistically continue to attract interest and achieve successful sales.

Zoopla’s July House Price Index reports:

  • UK house price growth has slowed to 1.3%.
  • The average UK home has gained around £3,400 in value over the last year.
  • Sales agreed are 9% lower than a year ago.
  • Approximately 30% of homes listed since the second quarter remain unsold without a price reduction.
  • Regional performance varies considerably, with the North West, North East and Scotland continuing to outperform London and parts of the South East.

For sellers, the message from both portals is clear: accurate pricing from the outset is more important than ever.

Mortgage Rates Remain a Key Influence

Mortgage affordability continues to play a major role in buyer confidence.

Earlier in the year many lenders reduced rates, but geopolitical events and rising funding costs caused a partial reversal. As of late July:

  • Average two-year fixed rates are generally between 5.5% and 5.6%.
  • Average five-year fixed rates are also around 5.5% to 5.7%.
  • The most competitive deals remain available below 4.5% for borrowers with substantial deposits or equity.

Despite mortgage rates being higher than many anticipated at the start of the year, competition between lenders remains strong and borrowers continue to benefit from a wide choice of products.

Bank of England Holds Interest Rates

The Bank of England’s Monetary Policy Committee announced on 30 July 2026 that the Bank Rate would remain at 3.75%, where it has been since December 2025. The decision reflected falling UK inflation, which currently stands at 2.6%, balanced against concerns over global energy prices and international economic uncertainty.

While many economists had expected interest rate cuts earlier this year, those expectations have been pushed back. The current consensus is that any future reductions are likely to be gradual, meaning borrowers should not expect a rapid return to the ultra-low mortgage rates seen in previous years.

Regional Markets Continue to Diverge

One of the most significant trends of 2026 has been the growing regional variation in house price performance.

Zoopla reports that the North West remains one of the strongest performing regions, while parts of London, the South East and South West have experienced flat or falling values. In the East Midlands, annual growth remains positive but more modest at around 1.2%, suggesting a stable rather than overheating market.

For buyers in Leicester and across Leicestershire, this is creating opportunities, with more stock available and increased scope for negotiation compared with the highly competitive markets seen during and immediately after the pandemic.

Looking Ahead

Although summer activity has softened, the underlying fundamentals of the housing market remain positive. Employment levels remain relatively strong, wage growth continues to outpace house price growth, and lenders remain keen to compete for business.

As we move into the autumn, much will depend on mortgage pricing, inflation trends and wider economic conditions. If mortgage rates stabilise or begin to ease again, both Rightmove and Zoopla expect activity to pick up following the summer holiday period.

For anyone considering a move, the current market offers opportunities for both buyers and sellers. Buyers are benefiting from greater choice and negotiating power, while realistically priced properties continue to attract committed purchasers and progress successfully through to completion.

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