This week brought some mixed economic news. For several months we have seen gradually falling inflation, leading to two base rate cuts since September, with hopes for more. But this week we heard that inflation has ticked up again, to 3.4% in December, from 3.2% in November.
At the same time, however, the Rightmove House Price Index reported the largest January rise in average asking prices since the index began 25 years ago. 2.8%!
In many ways this is being read as signalling renewed economic confidence.
So what does this mean for your house move in Herne Hill? Is one right and one wrong? Does one bit of news matter more, and the other less. If you are selling your home?
Overall, there is still plenty of reason to feel confident about moving home.
Here is a breakdown of the key developments and what they mean for the weeks and months ahead.
Before sounding any alarm bells, it is worth understanding what drove December’s inflation uptick. Not only that, but to note that it had been expected – albeit the expectation was to see 3.3%, and it rose to 3.4.
The increase was largely attributed to specific sectors rather than broad price pressures across the whole economy, with tobacco duty changes and higher December air fares playing a big part in the rise.
Economists often describe these as largely “one?off” or time?limited factors: temporary bumps in certain industries or sectiors, rather than clear evidence of a full reversal in the broader disinflation trend.
Despite December’s surprise, the wider view among many forecasters is that inflation is still likely to move closer to the Bank of England’s 2% target over the course of 2026. That matters.
The exact pace and timing are uncertain, and recent data is a reminder that the path downwards will not always be smooth. In fact, we shouldn’t expect it to be.
For homeowners and movers, it is the broader trend which matters more than any single monthly figure. It is the medium?term outlook after all that will guide interest rate decisions and, in turn, mortgage pricing.
With inflation ticking up slightly, the February interest rate decision has become more finely balanced. It makes it more likely that the Bank of England will hold rates steady at that meeting, as policymakers will want clearer evidence that inflation is firmly under control before making cuts.
Here is how we expect this to affect Herne Hill homeowners and buyers:
Some genuinely encouraging news is that the property market continues to show real resilience. Rightmove’s latest index shows January produced the largest jump in average asking prices for any January since the measure began, suggesting that buyer confidence and demand have picked up again.
For sellers in Herne Hill, it will come as welcome relief. It is well known that London’s market has taken a downturn in recent months – at odds with the rest of the country, over all – but perhaps a historic recalibration after the steep rises seen in London over previous years.
The average listing price in Herne Hill currently is in fact 15% below where it was last year according to Rightmove’s data. The average property here is now just over £720,000.
Well?presented, well-priced homes are attracting strong interest though, and, in many cases, actually securing better prices than a few months ago.
Nevertheless, overall, confidence has taken a knock as prices have dropped – not just in SE24 but across London and the South East.
Rightmove’s House Price Index news might be the signal therefore that this low confidence might be about to turn.
For buyers, rising prices are never ideal, but they do indicate a healthy, functioning market rather than a stagnant or falling one. Also, for any buyers who have been watching, waiting for the bottom of the market, this might be the sign you need that things are not likely to fall further. 15% in a year is significant, and as soon as confidence starts to return, I suspect we will see this pattern reverse fairly quickly.
Taking all of this together, the first half of 2026 looks set to be a favourable time to make your move in Herne Hill.
The area remains one of South London’s most desirable locations, with its village feel, excellent transport links, independent shops and generous green spaces. Demand for quality homes here often outstrips the supply coming to market.
Mortgage rates, while not guaranteed to fall further immediately, are generally far more manageable than they were 12–18 months ago, bringing some previously priced?out buyers back into the market.
If you are selling, you are doing so against a backdrop of recovering asking prices here in Herne Hill. If you are buying, moving sooner rather than later may mean getting in ahead of any further price growth should the current momentum continue.
A rise in inflation, even a relatively modest one driven by specific categories, is not ideal news and does add a note of caution to the near?term outlook.
At best, it may delay the interest rate cuts that many were hoping to see early this year, and there is no guarantee about the speed or scale of future reductions.
However, context is crucial. The overall picture still looks positive – by comparison to the way things looked in 2025, for example. Inflation is expected by many to ease over time, borrowing costs have reduced, and when it comes to the property market, we see it demonstrating renewed strength.
For those considering a move in Herne Hill in 2026, with every reason to expect that the fall in property prices may at last be levelling off, it is a positive moment for sellers and buyers alike.
As always, speaking with a professional adviser is the best way to understand how these trends apply to your specific budget and plans. If you are thinking about selling or buying in Herne Hill this year, we would be delighted to talk you through the local market, help you plan your move and support you in finding your new home, or securing a buyer for your own.
We are required by law to conduct anti-money laundering checks on all those selling or buying a property. Whilst we retain responsibility for ensuring checks and any ongoing monitoring are carried out correctly, the initial checks are carried out on our behalf by Lifetime Legal who will contact you once you have agreed to instruct us in your sale or had an offer accepted on a property you wish to buy. The cost of these checks is £60 (incl. VAT), which covers the cost of obtaining relevant data and any manual checks and monitoring which might be required. This fee will need to be paid by you in advance of us publishing your property (in the case of a vendor) or issuing a memorandum of sale (in the case of a buyer), directly to Lifetime Legal, and is non-refundable. We will receive some of the fee taken by Lifetime Legal to compensate for its role in the provision of these checks.