The UK housing market is in turmoil, with a staggering 10.7% drop in home sales recorded in the second week of June 2026 compared to the same period last year. London bore the brunt of this slowdown, experiencing a 14% decrease in sales, while other regions such as the North East saw only a modest 1% dip.
This stark decline in transactions contrasts sharply with the continued upward trend in property values. The average price per square foot for homes with agreed sales reached £349.64 in May 2026, marking a 1.9% rise over the last 12 months and a substantial 13.2% increase over the past five years.
Despite the dip in sales, the supply of new properties entering the market remains robust. In the week ending 14th June 2026, there were 36,500 new listings, closely aligning with the 2026 weekly average and surpassing the 10-year average for the same week.
However, the market is not without its pressures. Approximately 13.4% of homes for sale in May required a price reduction, slightly above the 2025 average and the six-year long-term average. This suggests that some sellers may be overestimating the current market value of their properties or are facing resistance from buyers.
For first-time buyers, the current landscape presents a daunting challenge. While a decrease in sales might suggest less competition, the continued rise in prices, coupled with potentially higher mortgage rates, could make entry into the market even more difficult. Existing homeowners may see the value of their properties increase, but a slower sales environment could impact those looking to move up the ladder.
Meanwhile, landlords are experiencing rising rental incomes, with the average rent in May 2026 reaching £1,785 per calendar month, up from £1,779 in May 2025. However, despite this increase, there is a slight decrease in available rental stock.
The current market dynamics signal a potential shift from the frenetic pace observed in previous years. While the overall number of homes sold year-to-date remains higher than in 2023 and pre-Covid levels, the recent weekly downturn suggests a need for cautious optimism among all market participants.