UK house prices edged up 1.3% in September, according to the latest Halifax data, signalling modest growth amid continued affordability pressures. While the market shows signs of resilience, high borrowing costs, construction challenges, and uncertainty ahead of the Autumn Budget are keeping sentiment cautious.
Amanda Bryden, Head of Mortgages, Halifax, said:
“The average UK house price edged down by -0.3% (£794) in September, following a modest rise in August. The typical home now costs £298,184. Over the past 12 months prices have grown by +1.3%, the slowest annual rate since April 2024.
“This slight monthly dip in house prices reflects a housing market that has remained broadly stable, prices are up +0.3% since the start of the year.
“It’s also important to remember that prices vary widely depending on characteristics like location and property type. As a result, many homes are available at a cost well below this headline figure. For
example, for those looking to take their first step on the property ladder, the typical first-time buyer home costs £236,811, up +1.7% year on year, with pockets of even greater affordability to be found across different regions.
“While affordability remains a challenge, a relatively lower mortgage rate environment and steady wage growth have helped support buyer confidence.
“Although the broader economic outlook remains uncertain, with the affordability picture gradually improving, we continue to expect modest growth through the remainder of the year.”
Nations and regions house prices
Northern Ireland once again lead the fastest annual property price inflation, with average property values up +6.5% over the past year (down from +7.9% last month). The typical home now costs £216,496, though prices remain well below the UK average.
Scotland recorded annual price growth of +4.5% in September to an average of £215,588. In Wales, property values rose a modest +1.9% year-on-year to £227,845.
In England, the North East, recorded the strongest annual growth with prices up +4.8% to £180,443, followed by the North West (+3.9).
The South West saw a second consecutive price fall by -0.2% over the past year (previously -0.7%) with prices now £303,067.
Meanwhile, prices are up only very slightly on the year in London (+0.6%) and the South East (+0.2%), with the capital the most expensive part of the UK, with an average property value of £543,497.
Here’s how industry experts are interpreting the latest Halifax house price figures:
Daniel Austin, CEO and co-founder at ASK Partners, said: “Today’s uptick in property prices offers a glimmer of optimism, but growth remains subdued as high borrowing costs continue to weigh on buyers. The Bank of England’s decision to hold rates provides limited reassurance, with persistently elevated fixed mortgage rates delaying meaningful relief for homeowners and first-time buyers alike.
“The construction sector continues to face headwinds from rising build costs, planning delays, and a shortage of skilled labour, while investors and developers remain motivated by the enduring supply-demand imbalance. Resilient sectors such as co-living, build-to-rent, and storage continue to attract capital, reflecting their long-term fundamentals even as broader activity cools.
“With global volatility high and domestic policy still in flux ahead of the Autumn Budget, the MPC is holding steady. Markets are still pricing in a rate cut before year-end, but with inflation unlikely to return, mortgage pressures will persist. For investors seeking stability amid market uncertainty, including the impact of renewed US protectionism, UK real estate debt remain a compelling option, offering capital preservation, steady income, and insulation from equity market swings.”
Nathan Emerson, CEO of Propertymark, comments:
“A fall in house prices reflects the ongoing pressure on the housing market from higher borrowing costs, economic uncertainty, and affordability constraints. While price declines may raise concerns among homeowners and sellers, they also present opportunities, particularly for first-time buyers who have struggled with stretched affordability in recent years.
“A cooling in prices is not unexpected given the current economic backdrop and should be viewed in the context of the significant gains seen over the past few years.
“As we look ahead, the key to restoring momentum lies in improving market confidence, whether through interest rate stability, better mortgage accessibility, or policy measures that ease the transaction process.
“Regional variations remain important to monitor, as not all areas will experience price movements equally. Policymakers and industry stakeholders must continue to support a functioning, fluid housing market that works for both buyers and sellers.”
Matthew Thompson, head of sales at Chestertons, comments:
“September has been a challenging month as many buyers paused their decisions ahead of the November Budget. Uncertainty over potential tax changes is holding back activity but if the announcements bring clarity, confidence could return quickly and create an unusually busy end to the year.”
