Zoopla says lower mortgage pricing and shifting affordability are tilting the balance towards ownership
Around 40% of homes currently listed for sale across the UK are now cheaper to buy with a mortgage than to rent, according to Zoopla’s latest House Price Index.
The property portal’s analysis, based on buyers putting down a 20% deposit and comparing local rents with mortgage costs, suggests that ownership has become more affordable over the past year, particularly for first-time buyers, against a backdrop of rising new listings and easing mortgage rates.
The shift reflects an increase in supply as well as changes in lending costs and criteria. February is on course to record the highest number of new instructions for the month in a decade, pointing to stronger seller confidence and heightened willingness to move.
Zoopla reports that there are now about 6% more homes available than at the same time last year and expects stock levels to build further into the spring. This additional choice is likely to support activity while helping to contain price growth through 2026.
Average rates on new mortgages have fallen to their lowest level in four years, helped by a lower base rate and keener competition between lenders. Two-year and five-year fixed-rate products are now available at below 4% for the first time since 2022, with the sharpest pricing typically reserved for borrowers with larger deposits and lower loan-to-value ratios.
Affordability assessments have also eased. Over the past 12 months, typical “stress” rates used by lenders have moved from about 8.5% to around 6.5%. In practice, this has brought more homes within reach for some borrowers when passing affordability checks.
Zoopla’s calculations indicate that, as a result, 40% of homes currently advertised on its platform are now cheaper to service on a mortgage than to rent locally, assuming a 20% deposit. This compares with about 25% of homes a year ago.
In several regions, including the North East, North West and Scotland, more than half of homes for sale are cheaper to buy than rent at a 6.5% mortgage stress rate. These areas tend to have lower price-to-income ratios and, in some cases, tighter availability of stock than last year, which is supporting localised price growth.
House price growth remains muted overall
Despite a pick-up in activity, headline price inflation remains subdued. UK house prices rose by 1.3% in the 12 months to January, down from 1.8% annual growth the previous year, underlining what Zoopla describes as a more stable market.
Northern Ireland is posting the fastest annual growth at 8%. Within Great Britain, the North West leads with values up 3.3% year-on-year, followed by Scotland at 2.8% and the North East at 2.5%.
In contrast, average prices in London are 0.2% lower than they were a year ago. Areas with stronger growth are generally more affordable and have fewer homes for sale than a year earlier, reducing buyer choice and underpinning prices. Across much of the rest of the country, price growth is flat or weaker than a year ago.
Southern England continues to be the softest part of the market, with average prices broadly unchanged over the past 12 months. Even so, this marks an improvement on the more widespread price falls recorded in the second half of 2025.
Commenting on the latest figures, Richard Donnell (pictured right), executive director at Zoopla, said: “Despite improved levels of market activity, subdued house price inflation is good news for buyers and sellers and represents a more stable market. More sellers putting their home on the market shows a strong desire to move home.
“Lower mortgage rates and improved affordability of mortgages means now could very well be the best time to buy a home in recent years, especially for first-time buyers with more homes available to buy for less than the cost of renting.
“We expect continued modest rates of price inflation over 2026 which will support healthy levels of sales with some wide variations across local markets. Sellers need to seek the advice of local agents to get the right strategy for their home.”
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