The UK housing market continued its steady upward trend in August, with property values rising for the third consecutive month. According to the latest Halifax House Price Index, average house prices increased by 0.3% (£932) last month, taking the typical property value to a new record of £299,331.
While annual growth eased slightly to +2.2%, the overall picture remains one of stability. Since January, prices have risen by less than £600, underlining how resilient the market has been despite wider economic uncertainty.
The Landlord Insurance team here at Lansdown have summarised the significant changes and what they mean for property owners.
Affordability shows signs of improvement
One of the more positive developments comes for first-time buyers. Although average house prices continue to edge higher, the typical first-time buyer property now stands at £237,577, a 0.6% fall since May.
With mortgage rates gradually declining, many now sitting below 4%, and wage growth outpacing house price inflation for nearly three years, affordability is slowly improving. For buyers with a 95% loan-to-value mortgage, monthly repayments could now come in below the average cost of private rent.
Regional trends highlight North/South divide
Across the UK, regional performance continues to vary:
- Northern Ireland leads the way, with property values up +8.1% year-on-year, although slightly down from July’s +9.3%.
- Scotland follows closely, recording +4.9% growth with average prices now at £215,594.
- North East, North West, and Yorkshire & the Humber all saw annual growth above 4%, cementing the North’s stronger market momentum.
- In contrast, the South West became the first UK region in a year to record a price decline, down -0.8% annually.
- London saw modest growth at +0.8%, but remains the most expensive region with an average price of £541,615.
Market outlook
Mortgage approvals reached a six-month high over the summer, which is an encouraging sign of demand, particularly given that August is typically quieter for the housing market.
Halifax notes that, supported by improving affordability and resilient demand, property prices are expected to continue a slow but steady climb through the remainder of 2025.
This article is for informational purposes only and should not be considered legal advice.
About Lansdown Insurance Brokers
Lansdown Insurance Brokers are specialists in Landlord Insurance and Block of Flats Insurance. We can provide flexible policies to suit your needs. Whether you’re a landlord, letting agent, or property owner, call the team on 01242 524498 or email enquiries@lansdowninsurance.com.
Lansdown is part of the Benefact Group, a charity-owned, international family of financial services companies that gives all available profits to charity and good causes.