High mortgage rates stall UK housing market: three in five homes unsold

Key Facts

With interest rates remaining elevated, the UK housing market faces mounting pressure as Zoopla data reveals that three in five homes listed for sale since January 2026 remain unsold. This figure points to a marked drop in demand, as high mortgage costs hinder potential buyers from completing transactions, prolonging the time properties stay on the market.

The data comes amid a challenging economic backdrop: UK CBI industrial trends orders plunged to -45 in June, well below the -35 forecast, indicating weakness in manufacturing. Meanwhile, US data showed the 30-year mortgage rate holding at 6.59% (per market data), while new home sales fell to an annualised 580,000 units, missing the 640,000 consensus. These indicators suggest persistent headwinds for housing markets on both sides of the Atlantic.

Domestically, the UK housing outlook hinges on the Bank of England's next policy moves. Markets are watching upcoming inflation and employment data for signs that could shift the rate path. Without a near-term rate cut, sluggish sales and potential price declines may continue to weigh on developers and investors.