October saw the biggest monthly rise in UK house prices since January this year, with the value of the average UK home increasing by 0.6%, compared to a fall of 0.3% in September, the latest Halifax house price index shows.
This is the fourth time in the last five months that prices have increased and brings the typical property price up to a new record high of £299,862, while annual growth also increased to 1.9%.
Northern Ireland continues to post the strongest rate of annual property price inflation, with average values up 8.0% over the past year, up from 6.4% last month).
Scotland recorded annual price growth of 4.4% in October and in Wales, property values rose 2.0% year-on-year.
In England, the North East recorded the highest annual growth rate, with property prices up 4.1% to £180,924.
London and the South East saw prices fall slightly in October on an annual basis, by 0.3% and 0.1% respectively.
Amanda Bryden, head of mortgages at Halifax, said: “Demand from buyers has held up well coming into autumn, despite a degree of uncertainty in the market, with the number of new mortgages being approved recently hitting its highest level so far this year.
“There is no doubt that affordability remains a challenge for many. Average fixed mortgage rates are currently around 4% and likely to ease down further, but with property prices at record levels, moving home can feel like a stretch.
“Rising costs for everyday essentials are also squeezing disposable incomes, which affects how much people are willing or able to spend on a new property.
“Even so, while there has been some volatility, the market has proven resilient over recent months, as many buyers opt for smaller deposits and longer terms to help make the numbers work. With house prices rising more slowly than incomes for almost three years now, we expect the trend of gradually improving affordability to continue.”
Jonathan Hopper, CEO of Garrington Property Finders, commented: “Pre-Budget jitters are giving the property market a bumpy ride.
“The direction of travel on prices has been seesawing. On a national basis, Halifax’s data shows they fell 0.3% in September but surged 0.6% in October.
“But split things by region and the market looks K-shaped. Prices in the north of England and Scotland continue to ratchet upwards, with almost no loss of momentum.
“Meanwhile average prices in London have settled into a pattern of steady decline. Across the capital as a whole they fell by 0.3% in the year to October, but in prime areas the falls are sharper.
“Meanwhile average prices in the commuter belt have slipped into near stagnation - up just 0.1% across the southeast over the past year.
“The reason for this growing divergence between north and south is that amid all the uncertainty about what property taxes this month’s Budget might hold, one thing is clear - the pain will fall disproportionately on higher value homes and this puts the southeast of England squarely in the Chancellor’s firing line. The ‘broadest shoulders’ are braced for impact.
“This is driving down prices and has had a chilling effect on the number of transactions, but it hasn’t stopped them entirely.
“Many buyers have simply pressed pause on their search, but we are seeing some capitalise on the sudden drop-off in competition and the abundance of homes for sale to pounce on the best properties and secure big discounts off the asking price.
“Yet this is a market that feels suspended between confidence and caution. Every move is tactical, every deal is hard-fought, and sentiment is fragile.
“The Budget will decide whether the pent-up demand is unleashed or throttled.”
Jonathan Handford, managing director at Fine & Country, added: “Today’s figures are a clear sign that the market is stirring back into life after what has been a fairly steady year for house prices. This uptick reflects easing affordability pressures, stabilised mortgage costs and an underlying buyer confidence that remains intact.
“For sellers, this is a timely reminder that value is still being upheld, however, expectations must align with the new market dynamics. Buyers now hold more choice, are more discerning and expect transparency and strong presentation when they walk through your door.
“In many parts of the country, supply remains elevated compared with recent years, so competition among sellers is real. A property that stands out through condition, price and presentation will attract interest quickly with some good marketing from an agent.
“With the Autumn Budget just weeks away, attention is turning to whether the Government will introduce further housing or tax reforms. Clarity around stamp duty or any proposed property levies would be welcome. We need to see confidence kept high in order to avoid buyers adopting a wait-and-see approach.
“Looking ahead, this momentum could carry into late autumn and early 2026, provided borrowing conditions continue to ease and economic sentiment stabilises. Buyers and sellers alike should be reassured that the market is healthy, active and primed for those who engage wisely.”
