What did Savills actually change?
On 1 June 2026, Savills published a revised mainstream UK house price forecast, cutting its 2026 prediction from +2% to -2%. That is a four-point swing in six months. Lucian Cook, head of residential research at Savills, noted that "higher borrowing costs and weaker sentiment will weigh on demand" through the rest of the year.
The agency expects the steepest price pressure to arrive over summer 2026, as mortgage offers agreed before the conflict in Iran begin to expire. Knight Frank also cut its 2026 forecast at around the same time, citing "continued downward pressure on activity" as buyers return to the market facing higher rates.
On a five-year view to 2030, both agencies remain positive. Savills' forecast for the period is +18.5%, with growth of 2.5% in 2027, 5% in 2028, and 6% annually in 2029 and 2030. The implication is that 2026 is a correction within an otherwise upward cycle, not a structural reversal.
Why have mortgage costs risen?
The conflict in Iran, which escalated in early 2026, drove up oil and energy prices. Higher energy costs fed into UK inflation expectations, which pushed gilt yields and swap rates upward. Swap rates are the benchmark lenders use to price fixed mortgage deals, so when they rise, fixed rates follow.
Average two-year fixed rates, which had fallen to around 5.18% in mid-May 2026, moved back up to 5.68% by 1 June, according to data from Uswitch and the HomeOwners Alliance. That is a half-point rise in under two weeks. On a £250,000 repayment mortgage over 25 years, the difference is roughly £70 per month, or about £1,680 over a two-year fix.
The Bank of England holds Bank Rate at 3.75%. The next Monetary Policy Committee decision is 18 June 2026. Markets are not currently pricing in a cut at that meeting.
Which areas are hit hardest?
London is forecast to fall furthest at -4% for 2026, reflecting the capital's higher average prices and therefore greater sensitivity to any rise in borrowing costs. The North of England, Scotland and Wales are expected to hold closer to flat, because stronger affordability in those markets provides more of a cushion when rates tick up.
The East of England, which covers Huntingdonshire, sits between the two. The region's house prices are partly anchored by Cambridge and the London commuter premium along the A14, which means they tend to move in a similar direction to the capital when rates rise, though typically at a smaller scale. Savills has not published a standalone East of England figure in this revision.
What does this mean for buyers in the patch?
For buyers in Huntingdon, Brampton, Godmanchester, St Ives and the wider Huntingdonshire patch, softer prices and more choice are the practical upside of this picture. Rightmove reports that the number of homes for sale is at its highest for this time of year since 2015, meaning buyers have more time to view, survey and negotiate than they have had for several years.
A 2% fall on a £300,000 patch property is a reduction of around £6,000 on the asking price. That is real money, and it comes on top of reduced competition at viewings and more room to negotiate on fixtures and completion dates.
The offset is the rate environment. If your current mortgage offer is due to expire in the next two to three months, talk to a broker before it does. A rate locked in May is likely to be cheaper than a replacement issued in June or July, and the gap is growing as swap rates rise.
What does this mean for sellers in the patch?
Sellers who price accurately are still selling. The Savills figure is a national average across very different local markets: Huntingdonshire villages on the A14 corridor, with direct links to Cambridge and Peterborough, will not feel the same pressure as a central London flat. But pricing optimistically against a backdrop of more stock and softer demand will cost time and, in most cases, money in the end.
Rightmove's national data shows homes are currently taking an average of 62 days to reach a sale agreed. That is not a crisis, but it is longer than the market absorbed during the 2021 to 2023 run, and it means sellers need to account for a longer campaign when planning their own onward move.
For those who are not compelled to sell this summer, the five-year outlook is encouraging. Savills forecasts recovery from 2027 onwards, with meaningful price growth building through 2028, 2029 and 2030. Sellers who can wait have a reasonable basis for patience. Sellers who need to move should price to the current market, not the peak of spring 2025.
What should you do right now?
- +Buying: get a mortgage offer in place now if you have not already. Check whether your broker can hold your current rate and for how long. The choice of homes is the best it has been since 2015, so take your time on the property, but act on the finance.
- +Selling: book a current valuation and price to the June 2026 market. Ask your agent what comparable properties have actually sold for in the last eight weeks, not what they were listed at.
- +Remortgaging: if your fix expires in the next six months, speak to a whole-of-market broker now. Drifting onto a standard variable rate in a rising swap-rate environment is avoidable.
A valuation from Villager Homes gives you a firm local figure to plan around, not just a national index. As independent estate agents in Huntingdon, we track weekly transaction evidence across every corridor from Kimbolton to St Ives, and we are happy to talk through what the Savills revision means for your specific property and plans.
For the most recent UK house price data, see our analysis of the Nationwide May 2026 house price report.
Sources: Savills residential research, forecast revision published 1 June 2026. Knight Frank residential research, June 2026. Uswitch and HomeOwners Alliance mortgage rate data, as of 1 June 2026. Rightmove property market data, May 2026. Bank of England Bank Rate, as of June 2026.