Spring Optimism
Lifts Prices

March 2026 | Page 2

Key Headlines

• Pricing Ticks Up on Seasonal Optimism: The mix-adjusted average home price for England and Wales jumped 0.6% during February. Annualised growth, however, remains poor at a mere 0.6% higher than in March 2025.
• Market Picks Up the Pace: Typical Time on Market (TToM) for unsold properties in England and Wales reduced last month but remains six days higher than in March 2025. Marketing times for unsold property are at a 5-year high. The worst increases year-on-year continue to be found in London and the South West.
• Unexpected Drop in Stock Levels: An unexpected drop in stock levels occurred during February. Counter to seasonal expectations, the total unsold stock on the market nudged down by 0.3%. The current sum of agents' portfolios now sits 1.7% lower than in March 2025. This positive development partly justifies some of the upward price action.
• Supply Remains in Line with Expectations: The total number of new instructions in February came in at 1% less than in February 2025. The most significant year-on-year reductions of new sales listings were in the North West and Wales (5% and 6% respectively).
• Wales Leads, London Lags: The mix-adjusted average home price rose in Scotland, Wales and all English regions last month, with the exception of the North East where the average slipped by 0.2%. The largest regional rise was in the South East (0.9%) which looks overly optimistic given the increase in marketing times since last year. Wales is now the top regional property market growth leader with a year-on-year gain of 2.8%, followed by the North West with an annualised rise of 2.5%. Meanwhile, London remains the weakest regional performer with a worsening annualised decline of 1.0%.

March 2026 | Page 3

Market Overview

Of course, these market dynamics were shaped by expectations of further rate cuts by the Bank of England later in the year. However, the misadventure taking place in the Persian Gulf and the subsequent catastrophic global economic consequences cast a long shadow. A period of stagflation is guaranteed with the only question being: For how long?

With energy prices already soaring, inflation will once again be at the front and centre of the Monetary Policy Committee's concerns, thereby cancelling the previous course of incremental base rate cuts. Moreover, the sudden spike in the 2-year swap rate, a proxy for mortgage rates, indicates that rate hikes are now to be expected. The rapidly increasing likelihood of higher mortgage rates comes as a severe blow to market sentiment, the consequences of which we will see play out over the coming months.

March 2026 | Page 4

Stock Levels Analysis

Stock levels have been worryingly high for over two years. Our data shows an unexpected drop in the total of unsold property on the market. The total still remains relatively high but the counter seasonal reduction in estate agents' portfolios is positive for home prices. Moreover, stock reduction suggests increased demand, although it can also indicate that vendors have given up (perhaps turning to the rental market).

Source: Home.co.uk Property Search Index

March 2026 | Page 5

Asking Price Trend

Home prices have shown their first strong uptick since June last year. The mix-adjusted average added 0.6% during February. However, annualised growth is exceedingly weak, also at 0.6%. These figures indicate how precarious home price growth remains overall. Relative to inflation, it is clear that residential property is not a safe store of capital now, and nor has it been since October 2021 (save for a single month: Sept 2024), relative to RPI ex. housing. We note that UK property is an asset class that continues to slowly deflate by stealth. The bubble created by ultra-low interest rates is undergoing a soft crash in real terms, in that lenders' balance sheets are not affected but investors' capital is slowly eroded.

Source: Home.co.uk HAPI Index

March 2026 | Page 6

Regional Variation

There is significant variation in price growth at the regional level. The annualised growth data is indicated in the maps later in this report but here we show the longer, 5-year growth figures. What is immediately clear is that there is not one English region, nor Scotland or Wales, where growth has managed to outpace inflation.

Source: Home.co.uk and Office for National Statistics

March 2026 | Page 7

UK Asking Prices by region

Scotland

£240,238

1m: +0.20%

12m: +2.42%

North East

£205,114

1m: -0.20%

12m: +2.01%

North West

£280,523

1m: +0.75%

12m: +2.50%

Yorks & Humber

£262,229

1m: +0.10%

12m: +0.98%

Wales

£278,653

1m: +0.76%

12m: +2.77%

West Midlands

£311,179

1m: +0.75%

12m: +1.40%

East Midlands

£285,417

1m: +0.10%

12m: +0.21%

East

£393,211

1m: +0.84%

12m: +0.24%

London

£541,689

1m: +0.42%

12m: -1.02%

South East

£444,890

1m: +0.91%

12m: +0.81%

South West

£378,077

1m: +0.42%

12m: -0.15%

March 2026 | Page 8

Time on Market Analysis

Regional Time on Market - March 2026

Source: Home.co.uk | Note: Average = Mean, Typical = Median days on market of unsold property

March 2026 | Page 9

Market Turnover & Real Price Growth

March 2026 | Page 10

Expert Commentary

The geo-economic reverberations of war in West Asia are having a devastating effect on financial markets around the world. The effective closure of the Strait of Hormuz means vital energy and fertilizer supplies have ceased. European energy markets for gas and fuel have entered an inflationary spiral that will rapidly feed into both the cost of living and the cost of borrowing.

The 2-year swap rate has climbed steeply since the start of the conflict, indicating that higher financing costs lie ahead. Added to that, as we enter a deeply inflationary environment, the Bank of England is highly unlikely to cut interest rates going forward, dashing the hopes of many in the UK property sector. Indeed, the Monetary Policy Committee may opt to raise the base rate to try to bring inflation under control.

The looming spectre of rising borrowing costs turns the market on its head. Having just begun the recovery from the last bout of inflation that raged from 2021 through to 2023, we are now faced with a tsunami of rising commodity prices, and there's no end in sight. Confidence in the UK property market will take a serious hit and recalibration will follow.

March 2026 | Page 11

About the Home Asking Price Index

The Home.co.uk Asking Price Index was originally devised in association with Calnea Analytics: the statistical consultancy responsible for the production of the official Land Registry House Price Index.

The Home.co.uk Asking Price Index (HAPI) is calculated using a weighting system based on the DCLG (formerly ODPM) Survey of English Housing Stock (published March 2006). This allows for enhanced regional delineation and conforms to the current geographical orthodoxy as set out by the Office of National Statistics.

Methodology Note: Properties above £1m and below £20k are excluded from the calculations.

Contact Details and Further Information

Future Release Dates