The average UK house price surged to a new record high of £299,331 in August, marking the third consecutive monthly increase, according to the latest Halifax index.
August saw a 0.3 per cent rise, following 0.4 per cent in July and 0.1 per cent in June. However, the annual pace of growth continued its slowdown, reaching 2.2 per cent in August, down from 2.5 per cent in July and 2.7 per cent in June.
Amanda Bryden, head of mortgages at Halifax, said: “The average property price now stands at £299,331 – a new record high – although annual growth has eased slightly to 2.2%.
“The story of the housing market in 2025 has been one of stability. Since January, prices have risen by less than £600, underlining how steady the market has been despite wider economic pressures.
“Though overall prices have edged higher, average property values for first-time buyers moved in the opposite direction over the summer, a trend that will be welcomed by those looking to get on the ladder.
“For those able to overcome the hurdle of saving a deposit, the numbers increasingly stack up. The typical first-time buyer property now costs £237,577, down 0.6% since May.”
Looking across the UK, Halifax said Northern Ireland continues to lead the UK for annual house price growth, with average property values up by 8.1% annually, although this marks a slight slowdown from 9.3% annual growth recorded the previous month.
Scotland saw the next strongest annual increase, with prices rising by 4.9% annually in August.
Across England, there remains a “clear north/south divide”, Halifax said.
The North East, North West and Yorkshire and the Humber all recorded annual growth above 4%.
By contrast, the South West has seen house prices fall by 0.8% on average over the past year, making it the first UK nation or region to record an annual decline since Eastern England in July 2024.
London continues to see modest growth, with prices up by 0.8% annually, but it remains the most expensive part of the UK, with an average property value of £541,615, Halifax said.
Earlier this week, a separate index, from Nationwide Building Society, indicated the average UK house price fell by 0.1% month on month in August.
Nationwide said the “relatively subdued pace” of house price growth could be a reflection of stretched affordability by long-term norms.
Tom Bill, head of UK residential research at Knight Frank, said: “Stable mortgage rates have helped the housing market get back on its feet after the April stamp duty cliff-edge but high levels of supply mean annual price growth has drifted lower.”
Karen Noye, mortgage expert at wealth manager Quilter, said: “The figures point to a market that while subdued continues to defy expectations.
“Bank of England data published this week showed mortgage approvals rising slightly, signalling that demand is starting to recover slowly. It offers some green shoots of optimism even as summer comes to an end.
“Yet affordability remains the key constraint. Mortgage rates, though down from their peak, have proved sticky and even edged back up in recent weeks as swap rates moved higher.
“First-time buyers still face a daunting hurdle while many existing homeowners are reluctant to take on new borrowing, keeping transaction volumes depressed.”
Alice Haine, personal finance analyst at Bestinvest by Evelyn Partners, said: “Recent surges in long-term bond yields – driven by investor unease over the state of the public finances and global economic and geopolitical concerns – could have implications for mortgages.
“A sustained rise in long-term borrowing costs runs the risk of pushing up mortgage rates – something that would hamper affordability levels just at the point that the market was starting to recover.”
Sarah Coles, head of personal finance at Hargreaves Lansdown, said sellers “may want to wait before cracking open the bubbly, because the future is far from certain”.
She added: “Now house prices are back at a record high, affordability risks being stretched. Meanwhile, there’s an awful lot going on which could damage price growth.
“The employment market has been weakening. New figures from the Bank of England show businesses are cutting jobs at their fastest pace since 2001 and aren’t planning to hire in a hurry either.
“The strength of the jobs market underpins the property market, so we could see those foundations become shakier. Meanwhile, the uncertainty created by Budget speculation risks putting buyers off.”
Here are average house prices followed by the annual change, according to Halifax (regional annual change figures are based on the most recent three months of approved mortgage transaction data):
East Midlands, £245,299, 1.6%
Eastern England, £334,860, 1.1%
London, £541,615, 0.8%
North East, £179,799, 4.7%
North West, £243,776, 4.5%
Northern Ireland, £217,082, 8.1%
Scotland, £215,594, 4.9%
South East, £387,509, 0.3%
South West, £301,134, minus 0.8%
Wales, £227,786, 1.6%
West Midlands, £259,575, 1.8%
Yorkshire and the Humber, £217,674, 4.1%
Jason Tebb, president of OnTheMarket, said: “Overall, the housing market is steady, although with increased levels of new instructions, longer transaction times and more competition for buyers, sellers should have realistic expectations if they wish to move before the end of the year.”
Jonathan Handford, managing director at estate agent Fine & Country, said: “The property market weathered the summer well and with autumn typically bringing a fresh wave of movers post-holidays, it’s likely to be a busy period for agents.”
This article was written by Vicky Shaw from The Independent and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to legal@industrydive.com.