But UK house price growth and sales agreed remain steady
Rising mortgage rates linked to the Middle East conflict have started taking a toll on buyer demand in recent weeks, according to Zoopla.
The property site’s latest house price index (HPI) for March 2026 reported that average mortgage rates in the UK have risen by around 0.4% over the past month, with many sub-4% deals withdrawn as financial markets adjust to expectations of higher inflation.
Meanwhile, buyer demand has weakened, running 13% below this time last year, which “reflects growing caution among households looking to move in the face of higher mortgage rates and concerns over the cost of living.”
However, the report described UK house price inflation as “stable” in March, up 1.3% from last month.
Sales agreed are also “holding up” and running at 2% below the same period in 2025, with market activity “supported by a core group of committed movers.”
Richard Donnell, executive director of research at Zoopla, said: “There are fewer buyers in the market than a year ago, but those who remain are serious and still getting deals done.
“Higher mortgage rates are making buyers more cautious, which means pricing correctly is more important than ever for sellers.”
The HPI indicated that buyers who have mortgage finance in place are pressing ahead with moves while earlier stage movers have adopted a “wait and see” approach.
It also noted that market activity is becoming “more reliant on a smaller pool of committed buyers” who are less affected by mortgage rate increases with around a quarter of sales reported as cash purchases while existing homeowners have “built up a sizable equity position in their homes.”
Meanwhile, the number of homes for sale is 6% higher than a year ago in spite of a “more uncertain backdrop.”
Zoopla said it does not expect a material impact on house price growth in the near term, unless weakened demand persists and translates into lower levels of sales activity over the coming months.
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