Halifax reports a 0.3% increase in house prices last month. With buyer confidence improving, the housing market is showing steady resilience.
House prices went up by 0.3% in August, the third consecutive monthly rise according to Halifax’s latest House Price Index, published on 5 September. The average UK property price is now £299,331. Annual growth went up by 2.2% but was down from 2.5% in July.
‘The story of the housing market in 2025 has been one of stability,’ says Amanda Bryden, Head of Mortgages at Halifax. ‘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%.’
Strong wage growth has also given buyers the confidence to move forward. Bryden adds: ‘Summer is typically a quieter period for the market, so the recent rise in mortgage approvals to a six-month high is an encouraging sign of underlying demand.’
Housing market shows resilience
Halifax admits that the wider economic picture remains ‘uncertain’, but Bryden says the housing market has shown resilience and ‘can take these challenges in its stride’. The lender expects to see a ‘slow but steady climb’ in property prices in the remainder of 2025.
Interestingly, despite property prices in general creeping up, average property values for first-time buyer homes moved in the opposite direction during the summer. ‘For those able to overcome the hurdle of saving for a deposit, the numbers increasingly stack up,’ says Bryden. ‘The typical first-time buyer property now costs £237,577, down from -0.6% since May. On a 95% loan to value mortgage over 30 years, that could mean monthly repayments of around £1179 compared to the average UK private rent of £1343.’
Regional house price variations
Northern Ireland remains the leader for annual UK house price growth, with average property prices up by 8.1% in the past 12 months. The typical home in Northern Ireland now costs £217,082.
Scotland saw the next strongest annual rise, with prices rising to 4.9% in August, while Wales saw prices increase by 1.6% year-on-year.
In England, there’s a North/South divide for property prices. The North East, North West and Yorkshire & The Humber recorded annual growth above 4%. However, the South West saw annual prices dip by 0.8% and London saw modest growth of 0.8% year-on-year. The average home in London now costs £541,615.