UK house prices rose in August to touch a fresh record high as mortgage affordability improved, according to the latest data released by Halifax.
The average UK house price reached a new record high of £299,331, marking the third consecutive month of increases with a 0.3% rise in August.
Despite this upward trend, annual growth has slowed to 2.2% from 2.5% in July, with average prices rising by less than £600 since the start of the year.
Regional variations remain stark, with northern England leading growth as the North East, North West, and Yorkshire & the Humber all saw increases exceeding 4%. The South West showed signs of considerable weakness with a 0.8% decline.
“House prices hit a new high in August, as the impact of the stamp duty holiday faded and the foundations of the market firmed up a little. More affordable mortgages and wages rising faster than house prices are playing a vital role, and with a modest rise in mortgage approvals in July, there’s the chance we could see the market strengthen in the autumn,” said Sarah Coles, head of personal finance, Hargreaves Lansdown.
However, Coles continued to warn that although the housing market has provided a welcome surprise over the summer, clouds are starting to form that could weigh on activity in the later stages of 2025.
“Sellers may want to wait before cracking open the bubbly, because the future is far from certain. Prices are still only up £600 since the start of the year, and there’s a risk that buyer enthusiasm could subside again before it has time to take hold. 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.”