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 is according to the latest Halifax House Price Index which suggests this slight monthly dip in prices reflects a housing market that has remained broadly stable, prices are up +0.3% since the start of the year.
Commenting on the latest figures Halifax head of mortgages Amanda Bryden said: “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.”
Quilter mortgage expert Karen Noye commented that the market continued to tread water as buyers and sellers adjusted to affordability pressures and a cautious lending environment.
“The government’s plans, announced yesterday, to reform the house-buying process could help reduce costs and delays over time. The proposals to require sellers to provide key information up front and explore binding contracts are designed to make transactions quicker and more transparent. But while these changes may improve confidence, they will not solve the deeper affordability challenge that continues to weigh on the market.
Financial buffers
She added: “The latest ONS data also suggest households may have far less of a financial buffer than previously thought. The revised figures halved the estimated household savings ratio for late 2022, implying many families saved significantly less during the post-pandemic recovery than earlier believed. With smaller savings cushions, more households may find it difficult to absorb higher mortgage costs or build deposits.”
Noye concluded that with borrowing costs still high, weaker household finances and potential tax changes on the horizon, house prices were likely to remain broadly stable in the near term, with regional trends reflecting local supply and demand rather than a clear national direction.
ASK Partners chief executive Daniel Austin said the uptick in property prices over the year offered a glimmer of optimism, but growth remained 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.
He added: “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 remains a compelling option, offering capital preservation, steady income, and insulation from equity market swings.”
