House prices hit a record high but go nowhere fast, as Halifax data lays bare a widening North/South divide and a market stuck in "static but stable" mode
UK house prices nudged to yet another record high in November but brokers say the market feels stuck in a holding pattern, with activity constrained by affordability and post‑Budget caution.
The latest Halifax House Price Index shows average prices were broadly flat on the month, rising just £139 compared to October, yet still pushing the typical UK home to a new peak of £299,892. Annual growth slowed from 1.9% to 0.7% – the weakest rate since March 2024 – as last year’s stronger price rises dropped out of the comparison.
Halifax’s head of mortgages, Amanda Bryden, described 2025 as “one of the most stable years for the housing market over the last decade”, with values holding steady despite spring’s stamp duty changes and Autumn Budget uncertainty. She also highlighted that on Halifax’s measures, affordability is now at its strongest since late 2015, with mortgage costs as a share of income at their lowest level in around three years.
Regional split widens as affordability bites
Northern Ireland remains the strongest performer, with prices up 8.9% year‑on‑year and the average home now worth £220,716. Scotland saw 3.7% annual growth in November to £216,781, while Wales recorded a 1.9% rise to £229,430.
In England, the North West led the way with values up 3.2% annually to £245,070, followed by the North East at 2.9%, where the typical property now costs £180,939.
Further south, prices slipped over the year. London values fell by 1.0%, the South East dipped 0.3% and Eastern England edged 0.1% lower, although the capital remains the UK’s priciest region with an average price of £539,766.
For brokers, that pattern is less about sentiment and more about the hard limits of what borrowers can afford.
Akhil Mair, Managing Director at Our Mortgage Broker, said: “We certainly validate the ‘static but stable’ assessment across much of the country. On the ground, the market feels like it’s in a holding pattern; while prices aren’t falling sharply, new transaction volume is noticeably constrained. This hard‑won stability is largely enforced by affordability.
“Higher mortgage rates have created a significant borrowing capacity squeeze. First-time buyers are consistently needing higher deposits to make the maths work, while movers are often trading down or staying put. The North/South price divergence primarily reflects the regional limits of that affordability squeeze.”
Affordability hurdles shift from deposits to monthly costs
Halifax’s view that affordability has improved is not being felt uniformly at broker level. Intermediaries acknowledge that pricing has eased from last year’s peaks, but say stress tests and day‑to‑day living costs are still limiting how far incomes can stretch.
“What we’re seeing broadly aligns with what Halifax is saying. Prices feel like they’ve hit a holding pattern. Not falling, but not convincingly rising either,” said Louis Mason, Head of Marketing and Communications at Oportfolio.
“Affordability is still the biggest thing when it comes to purchasing property. Even with improved mortgage pricing, many first‑time buyers are discovering that the monthly payments, rather than the deposit, are now the real hurdle. Movers, particularly families upsizing, are doing far more number‑crunching on long‑term costs than they were a year ago.”
Nick Mendes, Mortgage Technical Manager at John Charcol, agreed that the headline improvement in affordability masks a more nuanced picture.
“For first-time buyers, Halifax is right that affordability has improved on paper, but borrowing power remains constrained in practice,” he said. “Higher living costs and tighter lender assessments mean the gap between what buyers feel they can afford and what lenders will offer is still noticeable.”
Post‑Budget caution and investor pause
The Autumn Budget’s property tax changes and ongoing speculation around the rate path are also feeding into a cautious backdrop, brokers say.
Mair noted that the Budget had an immediate effect on investor appetite: “The Autumn Budget, particularly the proposed property income tax changes, drove an immediate, notable shift in investor behaviour, causing BTL purchase enquiries to stall. Overall, the market remains cautious, heavily focused on remortgaging and product transfers as clients wait for a clearer pricing trend before committing to new debt.”
Mason has seen a similar shift in buyer behaviour since the Budget and recent rate signals, with more planning but little sign of a surge: “Demand hasn’t surged, but it has become more intentional. More clients are enquiring, viewing, and getting paperwork lined up, not rushing to transact, but positioning themselves to move quickly if the right property or mortgage rate pops up. Our estate agent partners in London are also echoing this.”
Mendes said buyer engagement remains solid but many are waiting for confidence to rebuild: “Static but stable is exactly how the market feels. Buyers are still engaging, but many are taking a measured approach while they wait for confidence to rebuild. Expectations are that activity will pick up quickly once the seasonal slowdown passes. Motivated buyers are pressing ahead, but there is a cohort holding back for a little more certainty before committing, particularly in the South where pricing feels more finely balanced.”
Product trends: shorter fixes and sharper high‑LTV pricing
With many borrowers still adjusting to a higher‑rate world, product choice and term length are becoming key levers.
Mendes said remortgage customers are hedging their bets on the direction of rates:
“Remortgagers are favouring shorter fixes, and we are seeing stronger demand at higher LTVs as lenders sharpen pricing to compete.”
Across the market, brokers report that much of their workload remains dominated by remortgaging and product transfers rather than fresh purchase activity, particularly among more cautious or rate‑sensitive clients.
Slow grind into 2026
Looking ahead, Halifax expects “gradual” price growth into 2026, supported by steady market activity and the prospect of further interest rate reductions. Some major forecasters, including Savills, are pencilling in low single‑digit gains, while others warn that tax rises and frozen thresholds could continue to weigh on demand.
For brokers, the near‑term outlook is one of marginal gains rather than a breakout recovery: a market that wants to move, is structurally supported by tight supply, but is still tightly held in check by affordability, caution and policy noise.
