Average house price falls in February after January’s huge surge
The average asking price for a house in Britain saw a marginal fall of £12 in February, following a significant increase of around £10,000 in January, according to new data from property website Rightmove. This slight decrease reduced the average asking price across the country to £368,019, down from £368,031 in the previous month.
January’s rise, when prices rose by £9,893, marked the biggest increase for that month in Rightmove’s 25-year house price analysis. Despite a near-recession in February, a strong start to the year means 2026 is set to record its strongest sales price open since 2020, up 2.8 per cent since December. Rightmove attributes this growth at the start of the year to a recovery in confidence following prolonged uncertainty surrounding the autumn budget.
Colleen Babcock, property expert at Rightmove, stressed the need to see February figures in context. “The almost flat prices in February really need to be considered alongside what happened in January,” he explained. “After much uncertainty in the run-up to the end-November budget and the usual Christmas slowdown, we have seen activity pick up again from Boxing Day.”
Ms Babcock added: “Many sellers, some left behind for budget reasons, came to the market with renewed confidence in early 2026, which helped fuel January price growth. “But the fundamentals of the market remain unchanged.
There are still plenty of homes for sale and buying activity is not as strong as it was this time last year when many buyers were rushing to move ahead of the UK stamp duty increase. “Therefore, in February, sellers took a more cautious approach, maintaining January gains rather than raising prices at a time when competition was high and the market was still price sensitive.”
Compared to two years ago, the market is showing signs of strengthening, with the number of newly listed properties 11 percent higher than in 2024 and sales up 9 percent.
Ms Babcock suggested 2026 could be a positive year for buyers. “Average wages have increased by around 17% over the last three years, significantly outpacing property prices, which have increased by just 1.5% over the same period,” he said. “A more favorable mortgage rate and lending environment is also helping to improve buyer affordability. For those ready to move soon, February may offer a useful window of opportunity to make a move ahead of the busy spring selling season, when prices typically rise.”
Matt Smith, Rightmove’s mortgage expert, highlighted the positive impact of regulatory changes. “Last year’s review of the credit-to-income cap and the FCA (Financial Conduct Authority) reminder to lenders about stress testing flexibility had the intended positive outcome of allowing the typical buyer to borrow more,” he said. “On top of this, lenders continue to have a strong focus on helping first-time buyers, with many lenders creating new products to help eligible buyers borrow larger amounts.”
Local agents echoed this sentiment. Craig Webster, managing director of Tiger Sales & Lettings in Blackpool, observed: “Sellers are becoming more realistic as competition remains high, but demand remains resilient. Conditions are improving for buyers. Mortgage rates are trending downwards, lenders are becoming increasingly competitive and, importantly, wage growth has outpaced house price growth in recent times, helping affordability.” He advised that “those who are prepared and determined will likely be in the strongest position” as the busy spring market approaches.
Katie Griffin, director of Sawdye & Harris in Dartmoor, added: “Spring is always our busiest time and if sellers continue to price sensibly we will see increased activity. There is real buyer demand out there – people are just waiting for the right moment and the right property at the right price.”
In related research, property company Savills estimates that the total value of homes in the UK is now a staggering £9.18 trillion; This figure includes directly owned properties, including mortgages, social housing and the private rented sector. The total value of the UK’s housing stock increased by an additional £136bn in 2025, but this was less than the £268bn value added the previous year.
Lucian Cook, head of housing research at Savills, noted that the £336bn capital valuation since the end of 2022 was the lowest in a three-year period since 2013. It attributed this to initial pressure from rising mortgage costs in 2023, the housing market’s slow response to the Bank of England’s recent base rate cuts, the lack of price growth in London and the South East, and declining housebuilding levels.
Interestingly, despite accounting for just 27 per cent of the total value of homes in the UK, the North of England and the devolved countries have contributed 60 per cent of total growth since 2022. The North West has emerged as the best-performing region, with the total value of housing stock rising by £63bn since 2022.
