UK house price inflation forecast: current year
UK house price inflation forecast: current year stood at 1.72 in May 2026, according to HM Treasury — Forecasts for the UK economy. It is one of the indicators in the Consensus forecasts (HM Treasury) table (Value · Monthly), with a complete series running from Oct 2010 to May 2026. The complete series with an interactive chart, free to download.
This indicator in the Consensus forecasts (HM Treasury) table
| Indicator | 05-2026 | 04-2026 | 03-2026 | 02-2026 | 01-2026 | 12-2025 | 11-2025 | 10-2025 | 09-2025 | 08-2025 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| House price inflation, fourth quarter | |||||||||||
| Forecast for the current year | 1.72 | 1.62 | 2.26 | 2.23 | 1.97 | 2.02 | 1.82 | 1.51 | 1.92 | 1.71 | |
| Forecast for the next year | 1.67 | 1.82 | 2.55 | 2.58 | 2.37 | 2.05 | 2.54 | 2.72 | 2.79 |
Understanding UK house price inflation forecast: current year
Independent economic forecasters pool their residential property valuation models to estimate the expected twelve-month percentage change in residential property purchase costs across the United Kingdom for the active calendar cycle. This specific metric targets the annual growth rate as evaluated during the final quarter of the current annual cycle, capturing the consensus view of mortgage lenders, city institutions and economic consultancies regarding short-term residential value dynamics. Unlike longer-horizon projections for subsequent annual periods, this near-term gauge incorporates current mortgage pricing schedules, immediate housing market turnover volumes and observed lending approvals, reflecting how rapidly residential values are shifting in the immediate economic climate.
Interpreting this consensus requires recognising that property market expectations can shift rapidly in response to unexpected monetary policy adjustments or sudden shifts in housing market sentiment. Analysts must compare these pooled forecasts against realised official property price indices rather than asking prices, as asking prices often incorporate vendor optimism that fails to materialise in completed transactions. Because the underlying data undergoes regular methodological updates to account for mix-adjustments and property quality changes, long-term historical comparisons of these projections demand caution. Seasonality can influence early-year readings, making the year-on-year percentage change the standard benchmark for evaluating underlying momentum rather than raw period-on-period shifts.
Frequently asked questions
- What exact variable does this forecast measure?
- It measures the average expected percentage change in residential property prices across the United Kingdom over a twelve-month period, evaluated specifically for the final quarter of the current calendar year.
- How does this series differ from next year's house price inflation forecast?
- This series focuses on the immediate calendar year's fourth quarter outcome, whereas the sibling series looks further ahead to the subsequent calendar year, capturing longer-term housing market expectations.
- Why is a year-on-year comparison used for this housing metric?
- Comparing the current period against the corresponding period twelve months prior removes seasonal distortions caused by winter and spring buying patterns in the residential property market.