UK Prime Property: Industry Perspective January 2026

With the uncertainty surrounding the Autumn Budget now behind us, interest rates beginning to ease and inflation broadly under control, a clearer picture of the UK’s prime property market is starting to emerge at the outset of 2026.

While the year ahead is set against an increasingly complex global backdrop, early indications suggest buyers are adapting to a new normal rather than waiting for perfect conditions. Confidence is returning selectively, shaped by realism on pricing, clarity on costs and a renewed willingness to act where value and long-term fit align.

We ask our panel of trusted prime property experts what they are seeing on the ground, how sentiment has shifted since late last year, and what this means for buyers navigating the market in 2026.

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Prime Property Advisor Panel Q&A

This Industry Perspective brings together insight from a curated panel of prime property experts, spanning buying, finance, legal and education expertise. Together, these perspectives reflect on-the-ground experience across London and the UK’s key regional markets.

How does activity in January 2026 compare with this time last year?

Guy Meacock, Prime Purchase:

“Q4 last year was effectively written off for many clients. Those searches have rolled straight into January, making it feel noticeably more active.”

Ben Horne, Middleton Advisors:

“There’s been a noticeable increase in new buyers to the market making contact with us in the country… they were watching and waiting through the economics and politics of 2025 and have decided to enter the market now while there is increased certainty and stability. It will undoubtedly, and rightly, be cautious demand.”

Camilla Dell, Black Brick:

“I always gauge sentiment and how well the year will go on the number of new enquiries and clients we are engaged by in January. Our number of new enquiries is up by 22% this year compared to January 2025, which bodes well for 2026.”

What impact, if any, are you seeing — or anticipating — from the so-called ‘mansion tax’ measures on prime buyers’ decision-making?

Edward Towers, Aykroyd & Co:

“Absolutely zero impact, the changes are relatively miniscule, anyone buying a property for over £5m is not concerned with a £7,500pa extra charge… especially for overseas buyers where the holding costs at home (service charge etc) are often vastly higher than in the UK.”

Guy Meacock, Prime Purchase: 

“We’ve not heard any clients complain about the new council tax bands… it does rather pale into insignificance when compared with stamp duty. My concern is that while there is a palpable sense of relief that this Budget is behind us, what of the next one? These new bands could be a starting point with more to come, perhaps another band introduced for the very top end at some point.”

Liam Monaghan, LCP Private Office: 

“There will be a bunching in and around £2m, as buyers will be reluctant to exceed this amount for their purchase… The unknown is not what but when the amounts for this additional tax will be ramped up.”

Amongst the wider panel, the revised council tax bands are not viewed as having a meaningful impact on current buyer behaviour, particularly when set against overall transaction costs. Where any effect is anticipated, it is expected to be limited to some sensitivity around pricing thresholds. The greater note of caution sits with advisors themselves, who are more alert to how the policy may evolve over time, rather than its effect in its current form.

How is prime London performing at the start of 2026 and where do you currently see the most compelling opportunities for London buyers?

Hugh Obbard, Obbard:

“A key factor in 2025 was the acceptance and, to a degree, honesty about how much the market had actually been impacted. It is now widely accepted and reported that prices are off some 20-25%from their 2014/2015 peak…There is a lot of legacy stock from the past 2–3 years and so prices are unlikely to rise in the near term until the supply side starts to tighten again… the absolute stand-out opportunity is to buy property requiring major work as most buyers avoid this and the developer market has evaporated.”

Camilla Dell, Black Brick:

“Marylebone and Mayfair lead the way, with almost 10% price growth last year… In terms of discounts, the £5m-plus market will continue to offer buyers the best opportunities to negotiate, with fewer buyers, less competition, and more stock.”

Edward Towers, Aykroyd & Co:

“We see the best opportunities in large mansion flats (as these are currently less popular now there are less European families in London but offer incredible space) and short leases, with the correct advice, as the latter offer a great way to buy a quality asset at a discount.”

 Across the panel of prime property advisors, prime London is described as active but selective, with prime central London values still meaningfully below their previous peaks. Buyers remain highly value-led, and opportunities are most compelling where sellers are motivated and where buyers are prepared to take on complexity — whether through refurbishment, format (large flats) or lease structure.

How are prime regional markets performing as we start 2026 and where are you seeing the strongest demand or most resilient activity?

Ben Horne, Middleton Advisors:

“Where prices are right, or have been corrected over Christmas, viewings and offers are happening. One country house originally launched at £6.5m was significantly reduced by the agent to £3.5m and has now received an offer at the guide price. Activity, from a buyer’s perspective, is where the prices look sensible.””

Craig Fuller, Craig Fuller Property, Cotswolds:

“For some overseas second home buyers, the preference for turnkey property remains, but we are also seeing a growing interest in projects, particularly those with larger plots of land… this demand is increasingly focused on the southern Cotswolds rather than the north, where the ability to integrate more fully into a community is the driver, rather than the more transient and seasonal farmhouse draw. For many buyers, especially younger families, the motivation is less about seasonal appeal and more about long-term integration, established communities, year-round living and access to good schools. Education remains a key factor for overseas families, particularly from the US, where we are seeing younger buyers planning earlier, more permanent moves rather than purely discretionary second homes.”

Charlie Wells, Prime Purchase:

“There are also a few fresh buyers in the market, largely those who have been sitting on their hands wondering what wealth taxes the Labour government is going to dream up. I was with a group of HNW service providers only today and their view is that their clients are thinking life is too darn short so while they are being sensible and mindful, they are also getting on with it. Naturally there are individuals who are affected by various geo-political scenarios which are gathering steam every day, but even they have still got to get on with their lives. Hopefully, a couple of interest rate cuts this year will give people some confidence to take on debt and move forward.”

How are international buyers viewing the UK at the start of 2026 and has sentiment shifted at all since late last year?

Guy Meacock, Prime Purchase:

“There is still a strong surge of American buyers and Trump’s latest shenanigans won’t alter that. Last year we bought for a range of nationalities, and we aren’t seeing quite the number of Europeans we had in the past. London gets a lot of bad press, particularly with regards to crime, which Middle Eastern buyers in particular refer to a lot… Tax is another big issue in London from an international perspective, and it will be interesting to see if there are changes to VAT on shopping for visitors, for example.“

Ashley Wilsdon, Middleton Advisors

“US buyers continue to dominate the conversation, as we have seen a steady flow from the east coast. Second homes and super-prime rentals are the focus amongst this demographic.”

Edward Towers, Aykroyd & Co

“Last year USA buyers made up 35% of our market, the largest % for several years and we don’t see that changing anytime soon due to the situation at home… Quite simply overseas (and Non-Dom) buyers want to be here, they like it for the quality of the education, the rule of law, the proximity to Europe for trips, the attractive architecture and the fact it is still very safe.”

 Among the prime property advisors, international sentiment towards the UK at the start of 2026 is described as resilient rather than exuberant. American buyers remain the dominant cohort and continue to view the UK — and London in particular — as attractive on a relative basis. Elsewhere, interest from European and Middle Eastern buyers remains present but more cautious, shaped by tax considerations, media narratives and a focus on value and timing rather than urgency.

What advice would you give to buyers navigating the prime property market in 2026, particularly those considering acting in the first half of the year?

Camilla Dell, Black Brick

“I think the market for the first 4 to 5 months will be much more active than last year, with buyers feeling more confident now the budget is out of the way. Our advice to buyers buying their forever home is that buying conditions continue to favour buyers in 2026. Trying to time the exact bottom is a fool’s task. If you find the right home, at a reasonable / sensible price, then don’t wait.”

Ashley Wilsdon, Middleton Advisors

“Don’t base value on the selling agent’s guide price. A 10 or 15% discount might feel like a big win, but that may be misleading if the price was way too high in the first instance.”

Guy Meacock, Prime Purchase

“As the cost of buying and selling becomes ever greater, think in terms of decades, not single-figure years. How will this house adapt to my family and life in the future as well as now?”

How are you feeling about the year ahead for the UK’s prime property market?

Guy Meacock, Prime Purchase

“I am relatively optimistic. I don’t think we will see a substantial change in sentiment at least until we are in an election year or there is a change in government.”

Hugh Obbard, Obbard

“Cautiously optimistic and feeling there are reasons to hope this year rather feeling a need for hope which was more like the mood last year.”

Ashley Wilsdon, Middleton Advisors

“Positive. The general feeling is that 2025 is behind us and although we live in an uncertain world, our clients are overall more confident in making future plans and immediate decisions.”

Mortgages

What are you seeing in the mortgage market at the start of 2026, and how are current rates, product availability and lender appetite influencing how buyers are approaching property decisions?

Andrew Nolder, Director of mortgage broker SPF Private Clients:

“The year has got off to a strong start on the lending front with several lenders returning with pencils firmly sharpened – Barclays, HSBC, Nationwide and NatWest have all delivered fixed-rate reductions, along with some private banks.

Although inflation rose to 3.4 per cent in December, an increase in headline inflation was expected with some underlying measures remaining the same or rising by less than expected. Expectations remain that inflation will fall away this year and hit the Bank of England’s 2 per cent target in 2027.

While base rate may be held at 3.75 per cent at the February meeting of the Monetary Policy Committee, we expect the vote to be split, with further reductions to come this year as inflation moves closer to target. For buyers looking to take on debt to fund their purchases this year, this low rate environment is extremely encouraging.”

Conveyancing - Prime Property

Are you seeing any changes in conveyancing timelines or common risk points as we move into 2026, and what practical steps should buyers be taking early in the process to keep transactions on track?

Dee Aylward, Partner at law firm Mishcon de Reya LLP

“With the Autumn Budget now behind us and the “mansion tax” introduced in a more measured form than many anticipated, the market feels more settled. Buyer confidence appears to have improved, reflected by the increased activity we have seen so far this year. While local authority search issues continue to impact some transactions, indemnity insurance can offer a solution, though it should be considered carefully with your solicitor in advance.

We strongly recommend engaging with us at the earliest opportunity, even before an offer is accepted, to ensure a smoother process once the deal is agreed. Early engagement is especially important for overseas buyers, where tax planning can be complex and clients can benefit from tailored.”

Schooling for families relocating

With changes to VAT on school fees now part of the landscape, how are families factoring education planning into property decisions — and what advice would you give to buyers thinking about schools alongside a move in 2026?

Consultancy Director, Grace Moody-Stuart, The Good Schools Guide

“If your move allows, aim for a September start at a new school. While occasional places do arise during the academic year and the private sector is geared towards families who value a high level of optionality, planning ahead offers far greater choice and flexibility. Try to avoid moving schools in Years 6, 11 and 13, when options are more limited and transitions can be particularly disruptive.

With fees at an all-time high — driven by VAT and wider pressures across the sector — it’s worth knowing that some schools may be open to discussion, particularly for families with more than one child.

And for those already in the independent sector, don’t overlook notice periods at your current school. Notice usually needs to be given this (Spring) term to secure the return of your deposit — an easy detail to miss, but a costly one if you do.”

Looking Ahead

As 2026 unfolds, the balance of commentary suggests a market characterised less by hesitation and more by pragmatic acceptance of the environment in which buyers are operating. Uncertainty — whether economic, political or global — is increasingly treated as a constant rather than a temporary disruption.

Across both London and the regions, this has translated into a more purposeful and considered approach to decision-making. Buyers are not waiting for a return to past norms; instead, many are choosing to proceed where the fundamentals make sense, weighing value, suitability and long-term outcomes over short-term timing. The prevailing mood is cautious rather than exuberant, but constructive — with a growing number simply getting on with life and making plans accordingly.

Further analysis: The macro backdrop

The following analysis provides additional macroeconomic and housing market context to some of the themes explored throughout this report.

Commentary provided by Dominic Liversedge, Portfolio Director, Cazenove Capital:

“High interest rates, slowing employment and affordability have kept a lid on housing activity and house prices over recent years. But despite cost pressures, house prices have not fallen into negative territory.  This has been a similar phenomenon the world over, bar China where property markets have been in recession.  

Property is a key driver of consumer spending and economic growth, so as global equity fund managers it’s a sector that we follow closely. In our view, prices are being supported by a phenomenon that is also evident in other industries: supply shortages. For the UK and Europe, this has been due to planning restrictions together with high material costs and land prices which have slowed new build activity. For the US it is more to do with the structure of mortgages which are secured against properties for 30 years and cannot be ported. This ‘lock in’ effect has meant that homeowners have stayed put while they wait for mortgage rates to return to the longer-term average.

Looking forward, inflation is likely to continue a gradual downward path helped by lower energy prices and improving productivity. Interest rates have started to come down, and bond markets are forecasting UK rates to be cut another 0.5% to 3.25% by the end of this year.  Additionally, we have seen evidence of loosening lending requirements from the UK banks. This should feed into lower mortgage rates and better affordability in time.  Indeed, in recent years the UK has seen affordability improve relative to other regions, as measured by average house price to income ratios.

All told, absent a shock to the economy, the combination of persistent supply shortages and decreasing interest rates is expected to drive a gradual, upward pressure on prices. In the UK we have seen that mortgage approvals have picked up following the budget. Indeed, the Cazenove banking team have seen a fairly substantial pick up in property lending enquiries now that the budget fog has cleared. This suggests that house price inflation is likely to be at the upper end of the 2% to 5% range currently forecast by the market.”