January has brought a notable shift in the UK housing market, as sellers have raised asking prices for homes by nearly £10,000, according to data released by Rightmove. The average price of a property listed for sale this month reached £368,031, representing a 2.8 percent increase, or £9,893, compared to December. This marks the largest month-on-month rise in more than a decade, and the biggest January jump in the 25-year history of Rightmove’s house-price studies. After a period of uncertainty and subdued price growth preceding the autumn budget, the market appears to be regaining its momentum, with average asking prices now approaching levels last seen in August of the previous year.

The return of confidence among sellers is a key factor driving this sharp price increase. Following a tentative period, many homeowners have chosen to enter the market with higher expectations, encouraged by a resurgence in buyer interest. Rightmove’s data points to a 57 percent jump in buyer demand, measured by the number of inquiries to estate agents, in the two weeks after Christmas compared to the two weeks prior. At the same time, the number of homes newly listed for sale surged by 81 percent, reflecting a newfound optimism among property owners looking to capitalize on improved market conditions.

This renewed activity can be traced to several underlying causes. Firstly, the uncertainty that loomed over the market in the run-up to the autumn budget has largely dissipated, allowing both buyers and sellers to make decisions with greater confidence. In addition, the stabilization of mortgage rates has contributed to a more predictable environment, enabling potential buyers to plan their finances with fewer concerns about sudden cost increases. 

Colleen Babcock, a property expert at Rightmove, noted that the current price growth is particularly encouraging after several months of stagnation. She highlighted that sellers are now confident enough to list their homes at higher prices, while more buyers are returning to the market in search of new opportunities.

However, this upward trend in asking prices is not without its challenges. For many buyers, and especially for those seeking to enter the market for the first time, the prospect of rapidly rising prices could be a cause for concern. Affordability remains a significant issue, and the revival of asking prices to their previous summer levels may deter some from pursuing a purchase. 

Nonetheless, Babcock emphasized that current prices are only returning to where they stood last summer, before rumors about the budget unsettled the market and dented consumer confidence. In other words, the current increase is more of a market correction than an unsustainable surge.

Despite the positive signals, sellers have been cautioned against becoming overly optimistic. The number of homes available on the market, as well as the number of competing sellers, is at its highest level for this time of year since 2014. This abundance of choice means that buyers are in a strong position to negotiate, and sellers must remain pragmatic about their price expectations. 

Babcock advised that sellers should balance their desired sale price with the realistic prospects of finding a buyer in their local market, taking into account the increased competition. Overpricing could result in properties lingering on the market, especially when buyers have a wide array of options.

From a financing perspective, the outlook for mortgage rates is relatively stable. According to Matt Smith, a mortgage expert at Rightmove, rates are expected to remain steady over the coming months, with only minor fluctuations anticipated. For those who have delayed moving or purchasing a home in hopes of lower rates, the current environment may offer some of the best deals available in the foreseeable future. This stability is likely to encourage more buyers to re-enter the market, contributing further to the momentum observed in January.

Overall, the UK housing market in January 2026 presents a picture of renewed confidence and robust activity. While asking prices have experienced a significant jump, this is largely a return to previous levels rather than an unprecedented boom. Sellers are entering the market with higher expectations, buoyed by increased buyer demand and stable financial conditions. At the same time, the abundance of available properties ensures that buyers retain bargaining power, and both sides must navigate a competitive landscape. As the year unfolds, the interplay between these factors will determine whether the current recovery is sustained, or if new challenges emerge to test the market’s resilience.