UK House Prices Near Record Highs: Key Insights

The UK property market has shown resilience in recent months, with house prices on the rise once again. Thanks to falling mortgage rates and strong wage growth, buyers are returning to the market with renewed confidence. According to Halifax, the average UK house price in September came close to its record high, just shy of the peak set in June 2022. While the property market has seen challenges in recent years, there is now a steady recovery, and many are asking: Is it the right time to invest? This blog will explore the key trends driving the UK housing market and how Rothmore Property can help you find the ideal investment opportunity.

Key Takeaways

• UK house prices have risen for three consecutive months, with an average price of £293,399, just below the all-time high.
• Mortgage affordability has improved, boosting confidence among buyers as wage growth outpaces interest rate reductions.
• Certain regions, such as the North West of England, are seeing strong property price growth, making them attractive for investors.
• First-time buyers are benefiting from the current conditions, with prices around £1,000 lower than two years ago, despite overall market recovery.

The Rise in UK House Prices

In September, the average UK house price rose to £293,399, marking the third consecutive monthly increase. This rise, though modest at 0.3% or £859, brought the average price near the record high of £293,507 set in June 2022. Year-on-year, prices have grown by 4.7%, the fastest pace since November 2022. This recovery reflects a bounce-back from last year’s dip in the market, which followed the turmoil after the 2022 mini-budget, pushing up mortgage rates and slowing property demand.

The market is now benefiting from improved mortgage affordability. Wage growth has been strong, and interest rates have started to decline, easing the financial burden on buyers. According to Amanda Bryden, head of mortgages at Halifax, the number of mortgages agreed has surged by over 40% in the last year, hitting the highest level since July 2022. This signals a positive trend for buyers and investors alike.

Regional Market Performance

While overall house prices are rising, the growth has varied across the UK. Northern Ireland leads the pack with a 9.7% annual increase in house prices, making it the strongest-performing region. The average price of a home in Northern Ireland now stands at £203,593. Wales also saw significant growth, with prices rising by 4.4%, bringing the average home price to £224,119.

In England, the North West has shown impressive gains, with house prices climbing by 5.1%, reaching an average of £234,355. This region has become a hotbed for property investment, with cities like Manchester offering excellent growth potential and attractive returns. Meanwhile, London continues to have the highest property prices in the UK, with the average home now costing £539,238. Although this represents a 2.6% annual increase, it remains below the peak of £552,592 reached in August 2022.

First-Time Buyers: An Opportunity to Enter the Market

For first-time buyers, the current market offers a unique opportunity. While house prices are recovering, the average amount paid by first-time buyers is still around £1,000 less than two years ago. This suggests that despite overall market growth, entry-level buyers are benefiting from favourable conditions, such as improved mortgage deals and reduced competition in certain price brackets.

Lenders have also been offering more attractive mortgage rates, with some deals around the 4% mark—much lower than the 5% or higher rates seen after the mini-budget in 2022. This reduction in borrowing costs is helping buyers access properties that might have previously been out of reach.

The Outlook for the UK Property Market

Looking ahead, the UK property investment is expected to continue its steady recovery. While mortgage affordability is improving and interest rates are anticipated to drop further, housing costs remain a challenge for many buyers. However, regions like the North West and Northern Ireland present strong opportunities for investors looking to capitalise on growth.

How Rothmore Property Can Help

At Rothmore Property, we specialise in helping buyers and investors navigate the UK property market. With over 40 development sites across the UK, including thriving locations like Manchester, London and Liverpool, we offer tailored property investment solutions to suit every budget and goal.

Whether you’re a first-time buyer looking to enter the market or an experienced investor seeking high-growth opportunities, our award-winning team is here to guide you every step of the way. From securing the best mortgage deals to identifying high-potential properties, Rothmore Property assists you in making the most of the current market conditions.

Conclusion

The UK property market is showing clear signs of recovery, with house prices on the rise and mortgage affordability improving. For both first-time buyers and seasoned investors, the market presents exciting opportunities, particularly in high-growth regions like the North West and Northern Ireland. As interest rates continue to ease, now may be the ideal time to invest in property and secure long-term returns.