Property prices up 1.4% – down from 1.5% in June
The latest ONS Private Rents and House Price data reveals a market driven by price and strategy, not just demand, according to experts.
The conclusion follows UK average house prices increasing by 1.4%, to £273,000, in the 12 months to July 2026 – down from 1.5% in the 12 months to June 2026. Average UK monthly private rents, meanwhile, continued to increase, up 3.8% to £1,400 in the 12 months to August 2026 – an annual growth rate slightly up from the 3.7% recorded in the 12 months to July 2026.
“The figures point to a market where realistic pricing increasingly determines which homes sell and those that stall,” said Nick Leeming, chairman of national estate agency Jackson-Stops.
“Buyers are still there, but they are informed, selective and have more choice. This is not a market without demand, but it is one in which price and strategy matter considerably,” he said.
Looking ahead, not back
Leeming said sellers serious about moving need to respond to the market ahead of them rather than the market of the recent past.
Jonathan Hopper, CEO of Garrington Property Finders, said this was most evident in London, where prices £9,000 in June but fell by nearly £4,000 in July. “This is a buyer’s market in everything but confidence, he said.
“The sales that collapse this autumn will fall apart in the gap between what sellers remember their home being worth and what buyers are now willing to pay. Close that gap and deals will happen. Sellers who cling on to last spring’s price will find the market has moved on without them.”
Meanwhile, Tom Bill, head of UK residential research at Knight Frank, said he was pessimistic about further price growth. “We expect continued downward pressure on prices, particularly if pre-Budget speculation about tax rises intensifies, which feels likely as government borrowing costs also increase,” he said.
Rental growth masks pressures
In the rental sector, Alex Upton, managing director, specialist mortgages and bridging finance at Hampshire Trust Bank, said continued rental growth masked some of the pressures landlords are dealing with at the moment.
“Higher rents do not automatically mean stronger returns, and that is shaping the conversations we are having with landlords. Many are reassessing where they deploy capital and looking more closely at the role individual properties play within a wider portfolio. For those continuing to invest, it is increasingly about owning the right properties rather than simply owning more of them.”
He said demand for HMOs and other specialist property types was particularly strong, offering investors an opportunity to build more resilient income over the longer term.
