House prices rose by 0.3% in August, according to Halifax’s latest House Price Index, taking the average price of a property in the UK to £299,331 – a new record high.
It’s the third month in a row that prices have increased, suggesting that the market may now be stabilising. House prices are up 2.2% on an annual basis, although this is lower than the 2.5% recorded in July.
Amanda Bryden, head of mortgages at Halifax said: “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.
“Affordability remains a challenge, but there are signs of improvement. Interest rates have been on a gradual downward path for nearly two years, and many of the most competitive fixed-rate mortgage deals now offer rates below 4%.
“Combined with strong wage growth – which has outpaced house price inflation for nearly three years – this is giving more prospective buyers the confidence to take the next step.”
Better affordability for first-time buyers
Despite a general upward trend in property prices, the cost of homes typically purchased by first-time buyers has dipped slightly over the summer, making things slightly more manageable for those hoping to get onto the property ladder.
The average price for a first-time buyer property now sits at £237,577, down 0.6% since May. Based on a 95% loan-to-value mortgage spread over 30 years, monthly repayments would be around £1,179, noticeably lower than the UK’s average private rent, which currently stands at £1,343.
Northern Ireland retains property price growth top spot
Northern Ireland remains the UK’s strongest performer for annual house price growth, with values rising by 8.1% over the past 12 months to an average of £217,082. However, this is slightly lower than the 9.3% increase seen last month.
Scotland follows closely behind, posting an annual increase of 4.9% in August, with the typical home there now costing £215,594.
In Wales, prices grew by 1.6% year-on-year to an average of £227,786, though the rate of growth has been slowing.
Within England, region such as the North East, North West, and Yorkshire & the Humber all recorded annual house price rises exceeding 4%, placing them among the country’s top-performing areas.
However, the picture is less positive in the south, with the South West experiencing a year-on-year decline of 0.8%, making it the first UK region or nation to see prices fall on an annual basis since Eastern England’s 0.2% drop in July 2024.
London saw a modest annual increase of 0.8%. Despite slow price growth there, the capital retains its title as the UK’s most expensive region, with average property values at £541,615.
