UK house prices continued their upward trajectory in September, rising for the third consecutive month and bringing average property values within a whisker of record highs.
According to data from Halifax, one of the UK’s largest mortgage lenders, house prices increased by 0.3% in September, matching the rise seen in August. Over the past 12 months, prices have climbed by 4.7%, marking the strongest rate of annual inflation since November 2022.
The average UK home is now valued at £293,399, just £100 shy of the record set in June 2022, shortly before the market was disrupted by Liz Truss and Kwasi Kwarteng’s mini-budget, which led to rising borrowing costs and a sudden slowdown in the housing sector.
Amanda Bryden, head of mortgages at Halifax, cautioned against viewing recent gains as a full recovery: “While the typical property value has risen by around £13,000 over the past year, this increase is largely a recovery of the ground lost over the previous 12 months. Looking back two years, prices have increased by just 0.4%.”
House prices surged following the end of the first lockdown as buyers sought larger homes and outdoor space in what became known as the “race for space.” However, the mini-budget at the end of September 2022 brought the market to a standstill, with soaring interest rates and increased mortgage costs stifling demand. Now, with interest rates gradually falling and the cost-of-living crisis easing, buyers are beginning to return to the market.
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