What does Q1 say about the housing market?

If you are considering buying or selling your property, you may have been holding off, alarmed by the headlines about the economic impact of the Middle East conflict, desperately concerned about energy prices and unsure whether it’s the right time to be contemplating such a big move.

Such feelings aren’t surprising. Inflation rose to 3.3% in the twelve months to March 2026, with the price at the petrol pump the most significant influencing factor. It led to the Bank of England’s monetary policy committee voting 8-1 to maintain the bank rate at 3.75% for yet another month in April. The outlier member chose to vote for a 0.25% increase.

Inflation is likely to continue to rise as the effects of higher energy prices feed through and rather than the additional base rate cuts predicted for 2026 at the start of the year, rises could now be on the cards instead.

Yet despite these concerns, the UK housing market in the first quarter proved to be surprisingly resilient.

Price growth

In March, Nationwide reported UK annual house price growth of 2.2% to £278,880, up from 1% in February. Its April figures showed that prices had continued to grow, up to 3%.

Mortgage rates had risen, but this didn’t seem to be putting buyers off investing in their long-term housing needs, according to Rightmove, which points out that the typical mover is now able to borrow more thanks to recent relaxations in lending criteria.

It reported average new seller asking prices up 0.8% in both March and April – a smaller increase than usual but an increase nonetheless. The number of properties available for sale also remained strong, with an average of 59 properties on agents’ books across the UK.

Strong comparatives

The figures are also set against a strong 2025. In the same quarter last year, buyers were rushing to complete before stamp duty rose and pushed prices up further and the timing of the Easter holidays also made it harder to compare.

This April, demand was only 7% down compared to the same period in 2025, with demand most resilient amongst first-time buyers, down 6%. Meanwhile, the number of agreed sales was 3% lower. Rightmove says this shows that demand is holding steady.

The market is spooked – it would be strange if it wasn’t. But the figures seem to suggest, for the first quarter at least, that prices have held up and demand has remained resilient.

Looking to the future

What’s to come is less certain while economic volatility remains. Valuations are likely to be cautious, and buyers will still push hard for a competitive deal, conscious of increased pressure on their finances both now and over the coming months. Agents, meanwhile, will be working hard to secure the best deals, with realistic and competitive pricing at the heart.

But the evidence for the first quarter shows that buyers and sellers have focused on the long-term value of property investment and securing their dream properties – and that forward focus is unlikely to change.