Sarah Coles, head of personal finance at Hargreaves Lansdown, said: “The usual December chill set into the property market, with prices falling during the month, and barely rising at all in 2026.
“All the uncertainty and speculation around the Budget persuaded plenty of people to bide their time, so buyers who remained in the market could drive a hard bargain.
“In London, prices actually fell 1.3 per cent during the year, as on top of all of this uncertainty, there was an insurmountable affordability challenge.
“But we’re not necessarily set for a bleak midwinter overall, because there are plenty of reasons why we might see a January bounce.
“Average wages continue to rise significantly faster than house prices, so people can buy on more affordable multiples.
“Meanwhile, mortgage rates have been falling – thanks to a combination of Bank of England cuts and fierce competition – helping to make monthly payments less painful.
“There’s also the X-factor of sentiment, which tends to lift in January as buyers get a dose of new year optimism.
“However, the broader backdrop remains uncertain, wage rises are easing and a weaker jobs market will take a toll.
“The coming year is likely to remain relatively subdued, and prices aren’t going anywhere fast. If you’re in a position to buy, this could work in your favour.
“Having a target that’s moving more slowly makes it easier to plan.
“Plus the news that people will still be able to open a Lifetime ISA until its replacement is launched – and pay into it indefinitely – means first-time buyers can be confident in using it to boost their deposit.
“For every £4,000 they pay into it, they can get another £1,000 from the government towards their property purchase.”
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