‘Stabilised But Selective’ Market in 2026

The UK property market in 2026 is expected to be one of stabilisation rather than dramatic swings, influenced by gradual interest rate softening, improved affordability and a slow return of transactional activity. While the broader market isn’t likely to see explosive growth, the recovery will be uneven. Some asset types and locations are poised to strengthen, while others may lag behind. This reflects a market that’s becoming more strategic and selective rather than reactive.

According to Savills long-term regional forecasts, the North-West is projected to see ~29–31% cumulative growth between 2025 and 2029, significantly ahead of London’s ~15–17% over the same period, underlining stronger proportional growth outside the capital. RW Invest+1

Sectors Likely to Strengthen

• Prime residential in key city centres: sustained demand driven by affordability relative to London. RW Invest
• Grade A office space with strong sustainability credentials: take-up of high-quality offices across the Big Six regional cities increased sharply in 2024 and remains above long-term averages, showing businesses favour best-in-class space. EuropaWire
• Logistics and last-mile distribution hubs: the North West logistics market is forecast to see around 5.3% rental growth per annum over the next five years, demonstrating robust demand for quality space. Savills
• Purpose-built rental housing (Build-to-Rent): ongoing rental demand and limited new housing stock make BTR increasingly attractive for long-term investors.

Sectors Potentially Vulnerable

• Secondary offices with poor EPC ratings: occupier and investor preferences are increasingly polarised toward energy-efficient, adaptable buildings (see the sustainability section for more).
• Retail units in economically weaker high streets: particularly where experience-led retail hasn’t been integrated.
• Large suburban homes with high running costs: affordability and cost of living pressures may temper demand.

Reimagined Office Market

Despite headlines proclaiming their demise, offices are far from dead — they are evolving. The rebound in office use is particularly notable in regional cities. In 2024, the UK’s Big Six regional office markets (including Manchester, Birmingham, Bristol, Leeds, Glasgow and Edinburgh) recorded around 4.36 million sq ft of office take-up, marking a 26% increase year-on-year and the highest since 2019. EuropaWire

In 2026 and beyond, successful offices will not just provide desks, they will offer purpose:

• Collaboration-focused layouts: that support team interaction
• Transport-connected, amenity-rich areas: to attract talent
• Wellness features: such as improved air quality and natural light
• Flexible breakout and tech-enabled spaces

These traits respond directly to what occupiers now prioritise; quality, convenience and wellbeing.

Retail and High Street: Evolution Over Decline

Contrary to outdated narratives of retail decline, by 2026 the UK retail and high street landscape will increasingly reflect evolution rather than erosion. The most successful retail environments are those offering experiences, services, and convenience, not just products:

• Experience-led retail: blending dining, leisure and culture
• Retail that’s integrated into mixed-use developments
• Space anchored by services, food, leisure or community uses

This trend helps revitalise local high streets and regional centres, especially where landlords adopt creative tenant mixes and flexible lease structures.

Regional Cities Continue to Outperform

Manchester, Birmingham, Leeds, Liverpool, Bristol and Glasgow are forecast to outperform London on a percentage growth basis, and there are several structural reasons why:

• Lower entry prices: the affordability gap with the South-East gives regional cities room for growth. NP Residential
• Strong graduate retention: regional universities feed local talent pools.
• Major infrastructure investment: projects such as HS2 connections and urban regeneration programmes boost economic activity.
• Business relocations from the South-East — driven partially by cost considerations and hybrid working patterns.
• Growing tech, life science and creative industries, which are clustering in northern and midlands cities.

London will likely remain a global property hub, particularly for international capital and prime assets. However, its higher prices, regulatory pressures and slower percentage growth forecast (c.15–17% to 2029) mean regional markets can deliver stronger proportional returns in the coming years, especially for investors focused on capital growth and income. fabrikpropertygroup.com

Sustainability Is No Longer Optional

Sustainability has shifted from a nice-to-have to a core commercial consideration in 2026. Tightening Energy Performance Certificate (EPC) requirements, alongside rising energy costs and ESG-aware tenants, mean that environmental performance now directly impacts financial outcomes:

• Inefficient buildings: face higher void risk, reduced demand and potential obsolescence as tenants seek lower running costs and compliance.
• Sustainable upgrades: enhance asset value, improve energy efficiency and reduce operating expenses.
• ESG-aligned properties: attract higher-quality tenants on longer leases, as businesses increasingly factor sustainability into location and operations decisions.

Beyond environmental aspects, social and governance criteria are gaining prominence too, including accessibility, occupant wellbeing, and transparent asset management. For landlords in 2026, sustainability is not just about meeting regulations, it is about maintaining letability, reducing investment risk, and securing long-term income in a competitive market.

Belview have got big plans for 2026 and are always looking for new clients so if you’re looking for a new partnership then we would love to hear from you.

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