UK house prices hit a record high in October, with the typical property costing £293,999 on average, according to the latest data from the Halifax House Price Index.
This marks a 3.9% increase in prices compared to the previous year, continuing the trend of rising costs seen across the property market. On a monthly basis, house prices rose by 0.2%, surpassing the previous peak set in June 2022.
The data reveals a diverse picture of the housing market across different regions. Northern Ireland continues to lead the UK in terms of property price growth, with prices climbing by 10.2% year-on-year in October. The average price of a home in Northern Ireland stood at £204,242.
Wales also recorded growth, with house prices rising by 5.6% from the previous year, bringing the average price to £225,543. Scotland saw a more modest rise of 1.9%, with the typical property costing £206,480.
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The North West of England remained the region with the strongest growth in England, with prices up by 5.9% to £235,587. Meanwhile, London, despite having the highest average house prices in the UK, saw a more moderate increase of 3.5%, bringing the average property price to £543,308.
Amanda Bryden, head of mortgages at Halifax, pointed to a recovery in market activity despite ongoing affordability concerns. “Despite the affordability challenge, market activity has been improving,” she said
“The number of new mortgages agreed recently reached its highest level in two years. This aligns with average mortgage rates dropping steadily since spring — now over 160 basis points lower than in summer 2023 — coupled with continued positive income growth.”
However, Bryden warned that borrowing constraints remain a significant barrier for many potential buyers. “Looking ahead, borrowing constraints remain a challenge for many buyers” she added.
“Following the budget, markets expect the Bank of England to cut rates more slowly than previously anticipated, which could keep mortgage costs higher for longer. New policies like higher stamp duty for second-home buyers and a return to previous thresholds for first-time buyers might also affect demand.
“While we expect house prices to keep growing, it will likely be at a modest pace for the rest of this year and into next.”
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Nathan Emerson, CEO of Propertymark, cautioned that the budget could have a significant effect on the property market in the coming months.