North-South House Price Divide Widens as Affordability Bites
The UK housing market is showing a widening regional divide, with southern areas under more pressure as affordability and mortgage-rate concerns weigh on buyers.
The latest RICS UK Residential Market Survey said house prices were facing stronger downward pressure in London, the South East, East Anglia and the South West. By contrast, the North West and North of England continued to post marginally positive readings, while prices were still rising in Scotland and Northern Ireland.
The figures point to a market where higher borrowing costs are not being felt evenly. Buyers in more expensive areas may be more exposed to mortgage-rate changes because larger loans mean small rate movements can make a bigger difference to monthly payments.
What RICS said about the regional divide
RICS said its headline house price indicator slipped further into negative territory in April, moving to -34% from -25% in March. That means more surveyors reported falling prices than rising prices over the period.
But the national figure hides a clear regional split. London and parts of southern England are seeing stronger price falls, while more affordable northern markets are proving more resilient.
That does not mean the North is immune to mortgage pressure. Buyers everywhere are affected by rates, income, deposits and lender criteria. But where average prices are lower, the same mortgage-rate increase can sometimes be easier to absorb.
For more detail, read what factors affect how much you can borrow for a mortgage?
Why southern England is under more pressure
Affordability is the key reason southern markets are under more pressure.
In higher-value areas, buyers often need larger mortgages. When mortgage rates rise, the monthly payment on a larger loan can increase sharply. That can reduce borrowing power, make affordability checks harder and force buyers to lower their budgets.
This is especially relevant in London and the South East, where property prices are already high compared with incomes. Even if a buyer still wants to move, the mortgage may no longer fit comfortably.
For more detail, read how mortgage affordability is calculated by lenders.
Buyer demand remains weak
RICS said new buyer enquiries remained firmly negative in April, with a net balance of -34%. Agreed sales were also weak, with a net balance of -36%.
That suggests the issue is not just asking prices. It is confidence, affordability and the willingness of buyers to commit while borrowing costs and inflation expectations remain uncertain.
Buyers may still be browsing property portals and viewing homes, but more are likely to pause before making offers. In a market where the monthly mortgage payment is tight, buyers are more likely to question whether a property is worth the price.
For more detail, read why a Mortgage in Principle matters when house hunting.
Mortgage rates are changing buyer behaviour
RICS linked the subdued market to higher mortgage rates and wider geopolitical uncertainty. Mortgage-rate expectations have become a major factor in buyer confidence.
When rates are volatile, buyers may worry that a deal available today will not be available later. Others may delay applying because they hope rates will fall. Some may find that the amount they can borrow has already changed since they first started looking.
This uncertainty can slow the market. Buyers take longer, sellers become more cautious, and chains can become harder to hold together.
For more detail, read how mortgage rates actually work.
Why the North may be holding up better
Northern regions may be holding up better because average prices are generally lower than in London and the South East. Lower property prices can mean smaller mortgage balances, lower deposit hurdles and less severe monthly-payment shocks when rates move.
That can keep more buyers in the market, even when confidence is weaker nationally.
However, buyers should not assume a northern market is automatically easy. Lenders still assess income, debts, credit history, deposit, loan-to-value and regular spending. A buyer in any region can still be limited by affordability.
For more detail, read first-time buyer mortgages explained.
First-time buyers face different problems by region
For first-time buyers in London and the South East, the main challenge may be the size of the deposit and the monthly mortgage payment. Even a small change in rates can reduce the price range that works.
For first-time buyers in more affordable regions, the property price may be lower, but the same affordability rules still apply. Car finance, credit-card debt, student loan deductions, childcare costs and unstable income can all reduce borrowing power.
This means the regional divide is not simply about house prices. It is about the relationship between local prices, local wages, deposit size and current mortgage rates.
For more detail, read how to improve your chances of mortgage approval.
Sellers may need to adjust expectations
For sellers in weaker regions, especially London and parts of southern England, the RICS survey is a warning against overpricing.
If buyers are more cautious and mortgage affordability is stretched, a high asking price can quickly reduce interest. A home may still sell, but it may need to be priced realistically from the start.
Sellers in stronger regions should also be careful. Positive readings in parts of the North do not mean buyers will pay any price. The market is still being shaped by mortgage affordability, and serious buyers will usually know what they can borrow.
Valuation risk may increase in softer markets
When prices are under pressure, mortgage valuation risk becomes more important.
A lender will usually assess whether the property is suitable security for the mortgage. If the agreed price appears too high compared with local evidence, the lender’s valuation may come in lower than expected.
That can create a problem for buyers. They may need to renegotiate, increase the deposit or consider another lender, depending on the case.
This risk may be more common in areas where prices are falling or where sellers have not adjusted to weaker demand.
For more detail, read what is a mortgage valuation and why it matters?
Remortgagers should watch local values too
The regional divide also matters for homeowners remortgaging.
If local prices are rising, a homeowner may have more equity and could potentially fall into a better loan-to-value band. If local prices are falling, the opposite can happen. A borrower may have less equity than expected, which can affect the rates available.
This does not mean a small regional price fall will automatically cause a remortgage problem. But it does mean homeowners should check current property value and mortgage balance before assuming what products they can access.
For more detail, read what is remortgaging and how does it work?
What buyers should do now
Buyers should treat the regional divide as a reminder that national headlines are only a starting point.
A buyer in London may face a very different market from a buyer in the North West. A seller in the South East may need to price more carefully than a seller in a stronger local market. A first-time buyer in any region still needs to know whether the mortgage works in practice.
Before making offers, buyers should check borrowing power, get a Mortgage in Principle, review credit files, prepare documents and compare monthly payments at current mortgage rates.
For more detail, read is now a good time to get a mortgage?
Source
This article is based on the RICS UK Residential Market Survey for April 2026 and Guardian coverage published on 14 May 2026. RICS said new buyer enquiries remained negative, agreed sales were weak, and the house price indicator deteriorated further. It also said there was a widening regional divide, with stronger downward pressure in London and southern England while parts of northern England continued to perform better.
Bottom line
The UK housing market is not moving as one single market.
RICS data suggests southern England and London are under more pressure, while parts of northern England are proving more resilient. The difference appears closely linked to affordability, with higher-priced regions more exposed to mortgage-rate pressure.
For buyers, the practical message is to focus on local conditions and current affordability rather than national house-price headlines. For sellers, realistic pricing matters. For remortgagers, local values can affect loan-to-value and product options.
The divide may create opportunities in some areas, but the mortgage still needs to work.
