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UK house prices rose by 1.3% over the past year to September, marking the slowest annual growth since April 2024, as economic and tax uncertainties weighed on the market, according to Halifax. Prices fell by 0.3% compared with August, contrary to expectations. London recorded a 0.6% rise, while Northern Ireland saw the highest growth at 6.5%. Analysts said high borrowing costs, a slowing jobs market, and speculation about property tax increases were curbing housing demand. Nationwide data showed slightly higher annual growth of 2.2%.
UK house prices increased by 1.3% over the year to September, the slowest annual growth since April 2024, according to Halifax. On a monthly basis, prices unexpectedly fell by 0.3% compared with August, while economists had forecast a 2.2% annual rise and a 0.2% increase month-on-month. Advertisement
In August, house prices had risen by 2.0% year-on-year and 0.2% from the previous month. The current slowdown contrasts with the second half of 2024, when prices were growing between 4% and 5% annually. Market participants cited ongoing concerns about the economy and potential tax changes on properties, as finance minister Rachel Reeves prepared to support the budget in November, as key factors influencing buyer confidence.
Amanda Bryden, head of mortgages at Halifax, said that while the broader economic outlook remains uncertain, gradual improvements in affordability support expectations of modest growth through the rest of the year. Ashley Webb, an economist at Capital Economics, observed that weak price trends reflect other signs of a slowing jobs market, continued high borrowing costs, and speculation about future tax hikes. He added that any property tax increases in the upcoming budget could reduce real household disposable incomes and further affect housing demand in the next year.
Regionally, London house prices rose by 0.6% over the past year, while Northern Ireland reported the strongest growth at 6.5%. Other areas saw moderate increases as affordability constraints and economic uncertainty continued to shape market activity. Rival lender Nationwide reported that house prices in September alone rose by 0.5%, pushing annual house price inflation to 2.2%, slightly higher than Halifax's figure.
The data indicates that while certain regions continue to experience price growth, overall momentum in the UK housing market is slowing. Factors such as borrowing costs, economic confidence, and potential policy changes are influencing buyer behavior and limiting rapid price increases.
Source Reuters
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