"More sellers putting their home on the market shows a strong desire to move home"
- Richard Donnell - Zoopla
February is on track to record the highest number of new home listings in a decade, according to Zoopla’s latest House Price Index.
As mortgage rates continue to fall, 40% of homes currently for sale on Zoopla are now cheaper to buy with a mortgage than the cost of renting locally, assuming a 20% deposit. This is a large increase from 25% last year.
With confidence building in the housing market and a strong desire for many households to move, this month is on track to record the highest number of new listings in February for a decade.
Currently, there are 6% more homes for sale than a year ago - something Zoopla expects to rise further in the coming months, increasing choice for buyers while keeping price increases in check over the remainder of the year.
Furthermore, average mortgage rates for new loans are at their lowest level for 4 years due to lower base rates and stronger competition between lenders. In real terms, this means that rates on both two-year and five-year fixed deals are now below 4% for the first time since 2022.
On top of this, the criteria in terms of how mortgage lenders assess affordability have eased over the past year. Today, lenders are typically checking that borrowers can afford a higher mortgage rate of 6.5%, whereas a year ago, this was 8.5%.
In some regions - the North East, North West and Scotland - over half of homes for sale are cheaper to rent than buying at a 6.5% mortgage ‘stress rate’.
Despite the increase in market activity, house price growth remains subdued at 1.3% growth (12 months to January) compared to a year ago. This is versus 1.8% the previous year.
Northern Ireland is registering the fastest rate of price growth at 8%, and across Great Britain, the North West is the strongest-performing region, with prices up 3.3% year-on-year, followed by Scotland (2.8%) and the North East (2.5%). In contrast, average prices in London are 0.2% lower than a year ago.
The areas with higher price growth are more affordable and have fewer homes for sale than a year ago, limiting buyer choice and supporting price growth. Across the rest of the country, price growth is the same or weaker than a year ago. Southern England remains the softest market, with average prices broadly unchanged over the last 12 months.
"Despite improved levels of market activity, subdued house price inflation is good news for buyers and sellers and represents a more stable market," Richard Donnell, executive director at Zoopla, said. "More sellers putting their home on the market shows a strong desire to move home."
He added: "Lower mortgage rates and improved affordability of mortgages mean now could very well be the best time to buy a home in recent years, especially for first-time buyers with more homes available to buy for less than the cost of renting.
"We expect continued modest rates of price inflation over 2026, which will support healthy levels of sales with some wide variations across local markets. Sellers need to seek the advice of local agents to get the right strategy for their home."
Sarah Cartlidge, branch manager at Merseyside agent Fraser Reeves, added, "We’re seeing multiple factors coming together, including improving mortgage rates and easing lending criteria to make a more healthy and confident sales market recently. There are plenty of new properties being listed since January, and this continues to be the case as we move into spring."
