UK house prices dip as market stabilises – Halifax

House prices across the country saw a small dip in September, pointing to a housing sector that remains balanced despite economic headwinds.

Figures from Halifax reveal a 0.3% or £794 monthly drop, reversing the slight price rise in August.

The average home now costs £298,184, while the annual rate of increase slowed to 1.3%, down from 2% the previous month.

That’s the slowest annual rate since April 2024.

Market is stable

The lender’s head of mortgages, Amanda Bryden, said: “This slight monthly dip in house prices reflects a housing market that has remained broadly stable.

“It’s also important to remember that prices vary widely depending on characteristics like location and property type.

“While affordability remains a challenge, a relatively lower mortgage rate environment and steady wage growth have helped support buyer confidence.”

She added: “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.”

Regional house price performance

Northern Ireland keeps its position at the top of the growth table, with values up 6.5% year-on-year, although that was slower than August’s 7.9%.

Average prices there stand at £216,496, still well below the national figure.

Scotland posted a 4.5% annual uplift, taking typical prices to £215,588. Wales saw a 1.9% rise, bringing the average to £227,845.

In England, the North East leads with a 4.8% annual jump to £180,443, followed by the North West with 3.9% growth.

The South West recorded a second consecutive yearly fall of 0.2%, taking prices to £303,067.

London and the South East saw barely any movement, with the capital edging up 0.6% and the South East increasing 0.2% year-on-year.

London remains the most expensive region, with the average property costing £543,497.

Property sector reaction

Nathan Emerson, the chief executive of Propertymark, said: “A 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.”

Matthew Thompson, the head of sales at Chestertons, said: “September has been a challenging month as many buyers paused their decisions ahead of the November Budget.

“Uncertainty over potential tax changes is holding back activity but if the announcements bring clarity, confidence could return quickly and create an unusually busy end to the year.”

Guy Gittins, the chief executive of Foxtons, said: “Market momentum remains steady, and this underlying stability is encouraging buyers and sellers back into the fold, albeit with a degree of caution ahead of November’s budget.

“For those looking to sell, the key to success is a pragmatic approach to pricing in line with current market conditions, but those looking to complete their sale before Christmas need to be entering the market now with the right agent and an added sense of urgency.”

Marc von Grundherr, a director of Benham and Reeves, said: “The UK property market has weathered a year of market uncertainty and buyer indecision with house prices continuing to show positive annual growth, albeit we’ve seen a marginal month on month decline due to an air of hesitation ahead of next month’s Autumn Statement.”

Verona Frankish, the chief executive of Yopa, said: “It’s been very much a case of the tortoise not the hare when it comes to the performance of the UK property market this year and this has arguably been a far healthier market landscape for both buyers and sellers alike.

“Slow but sustainable rates of house price growth have ensured that sellers are motivated to move, whilst buyers aren’t being priced out by sizable shifts in property affordability.”

Tom Bill, the head of UK residential research at Knight Frank, said: “Sellers are getting the message that house prices are under pressure due to higher levels of supply and a creeping mood of caution as November’s Budget approaches. “Stable mortgage rates have supported demand, but we believe prices will continue to dip modestly before ending the year broadly flat.”