Market remains steady, but economic uncertainty shape outlook
Following a small increase in the previous month, the average price of a UK home declined by 0.3% in September, according to the latest Halifax House Price Index.
The typical property now stands at £298,184. Annual price growth slowed to 1.3%, marking the weakest rate since April 2024.
“This slight monthly dip in house prices reflects a housing market that has remained broadly stable,” said Amanda Bryden, head of mortgages at Halifax. “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.”
Bryden noted that the average price paid by a first-time buyer is £236,811, representing a 1.7% increase over the past year, with lower-priced properties available in certain regions. “While affordability remains a challenge, a relatively lower mortgage rate environment and steady wage growth have helped support buyer confidence,” she said. “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.”
However, for Nathan Emerson, chief executive of industry body Propertymark, the 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,” Emerson said. “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.
According to him, 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. “Policymakers and industry stakeholders must continue to support a functioning, fluid housing market that works for both buyers and sellers,” he said.
Karen Noye, mortgage expert at wealth management firm Quilter, pointed out that the market continues to tread water as buyers and sellers adjust to affordability pressures and a cautious lending environment.
“In the run-up to the budget, speculation about possible changes to property taxation has added another layer of uncertainty,” Noye said. “With borrowing costs still high, weaker household finances and potential tax changes on the horizon, house prices are likely to remain broadly stable in the near term, with regional trends reflecting local supply and demand rather than a clear national direction.”
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts, observed that serious buyers are committing and keen to move before the end of the year, with the market surprisingly resilient. “Well-priced property continues to sell, and the gap between serious buyers and sellers has narrowed,” she said. “Competition is strong for the best homes, particularly in areas where stock levels are constrained. Buyers remain price-sensitive, with those motivated to move pressing ahead.”
The latest Halifax House Price Index also showed that across the UK, regional price trends varied. Northern Ireland recorded the highest annual increase at 6.5%, with the average home valued at £216,496, though this remains below the UK average. Scotland saw prices rise by 4.5% year-on-year to £215,588, while Welsh property values increased by 1.9% to £227,845.
In England, the North East led with 4.8% annual growth, reaching £180,443, followed by the North West at 3.9%. The South West experienced a 0.2% annual decline, with average prices at £303,067. London and the South East saw only slight increases, at 0.6% and 0.2% respectively, with London remaining the most expensive region at £543,497.
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