UK house price growth slows on higher borrowing costs
A Reuters poll of analysts indicates British home prices will rise by 1.8% this year as high mortgage rates and inflation reduce purchasing power. While London prices are expected to dip slightly in 2026, rental costs across the country are projected to outpace property value growth.
Analysts in the United Kingdom expect home prices to rise 1.8% this year as high borrowing costs dampen buyer demand. This forecast is a downgrade from the 2.5% growth predicted three months ago. For investors, the data signals a cooling residential market where rental yields may soon outperform capital appreciation.
### Borrowing Costs Curb National Growth High mortgage rates and inflation are restricting purchasing power across the British housing market. A Reuters poll conducted from late May through early June found that while 2026 growth is slowing, median forecasts for 2027 and 2028 remain steady at 3.0%.
