Average house prices rose by +1.1% in October, compared to a fall of -0.3% in September, with a typical UK home now costing £281,974, up around £3,000 on the previous month.
“UK house prices rose in October, up +1.1% on a monthly basis, breaking a run of six consecutive monthly falls. The average house price is now £281,974 – an increase of almost £3,000 compared to the previous month. On an annual basis, prices are down -3.2%, though the decline was at a slower pace than we saw in September (-4.5%).
“Prospective sellers appear to be taking a cautious attitude, leading to a low supply of homes for sale. This is likely to have strengthened prices in the short-term, rather than prices being driven by buyer demand, which remains weak overall. While many people will have seen their income grow through wage rises, higher interest rates and wider affordability pressures continue to be challenges for buyers.
“Across the medium-term, with financial markets not anticipating a decline in the Bank of England’s Base Rate soon, we expect house prices to fall further overall – with a return to growth from 2025.
“The current picture should continue to be seen in the context of the longer-term house price trend as, on average, prices remain around £40,000 above pre-pandemic levels.”
First-time buyer market shows relative resilience
Despite weakness in overall buyer demand, the first-time buyer market has held up relatively well. Buying a first home remains attractive for many, especially against the backdrop of rental prices increasing.
The latest house price data shows prices for first-time buyers are down -2.4% annually, a notably smaller fall than the market generally (-3.2%), over the past year.
Overall, however, the housing market remains subdued, with October marking the first rise in the cost of a typical UK home since March.
Nations and regions house prices
All UK nations and regions saw house prices decline on an annual basis. The greatest fall was seen in South East England, where prices decreased by -6.0% over the last year (average house price now £374,066).
Scotland’s annual house price was the most resilient, down just -0.2% annually, with homes in the nation now costing an average of £202,608. It was a similar picture in Northern Ireland, with a decline of -0.5%, and average house prices of £183,922.
Property prices in Wales fell by -3.9% over the year (average house price £213,125).
London continues to have the highest average house price in the UK, at £524,057, falling -4.6% over the last year.
