The average UK house price increased on a month-on-month basis for the first time in four months in June, according to an index from Lloyds Banking Group. Property values rose by 0.2% month on month, marking the first monthly increase since February. Annual house price growth also accelerated to 0.6% in June, up from 0.5% in May. Across the UK, the average property value in June was £299,330.
Market Context and Expert Views
Amanda Bryden, head of mortgages at Lloyds, said: "House prices rose for the first time in four months during June, increasing by 0.2%, compared to May. The typical property now costs £299,330 while the annual rate of growth also edged higher to 0.6%. Recent price trends continue to reflect wider economic uncertainty, including the impact of global events on inflation and interest rate expectations." She added: "While affordability remains stretched for many buyers, mortgage rates have eased from their recent highs, offering some encouragement to those considering a move. Looking ahead, we expect the housing market to continue moving at a measured pace. Lower borrowing costs should provide some support for demand, though affordability constraints remain an important factor. The outlook for house prices will depend largely on inflation continuing to ease and household confidence gradually improving."
Regional Variations
According to Lloyds, average house prices and annual changes varied across the UK: East Midlands £247,711 (1.1%), Eastern England £331,348 (-1.2%), London £534,831 (-1.1%), North East £181,133 (2.8%), North West £248,218 (2.4%), Northern Ireland £229,000 (7.4%), Scotland £223,277 (3.9%), South East £381,654 (-2.0%), South West £299,532 (-1.3%), Wales £231,142 (0.9%), West Midlands £262,968 (0.8%), and Yorkshire and the Humber £217,544 (0.8%).
Industry Reactions
Tom Bill, head of UK residential research at Knight Frank, said: "House prices are going sideways and transactions are falling as the result of higher mortgage rates since the start of the Middle East conflict." Iain McKenzie, CEO of The Guild of Property Professionals, commented: "The return to monthly house price growth is an encouraging sign that the market continues to demonstrate resilience despite a challenging economic backdrop. Buyers remain cautious, but we’re seeing confidence gradually improve as inflation remains relatively contained and expectations for interest rates have become more stable."
Mark Harris, CEO of mortgage broker SPF Private Clients, noted: "Lenders continue to slowly chip away at their mortgage rates, which is giving hope to borrowers and encouraging activity. However, buyers are not getting carried away – the small uptick in average house prices indicates that buyers are negotiating hard and not willing to pay more than they need to. First-time buyers will be encouraged as house prices remain steady rather than soar." Nicky Stevenson, managing director at Fine & Country, said: "A monthly increase of 0.2% is modest, but that is no bad thing in the current climate. Buyers are still navigating affordability pressures and a shifting mortgage market, so steady movement is healthier than sharp jumps that risk pricing more people out."
Jason Tebb, president of OnTheMarket, added: "Those who need to move continue to buy and sell homes. Affordability concerns remain but easing mortgage rates are helping, as borrowers adapt to shifting market conditions." Sarah Coles, head of personal finance at AJ Bell, remarked: "The newly rebranded house price index started with a whimper, not a bang. On the plus side, house prices rose for the first time in four months, on the downside they were only up a whisker, and the signs for the rest of the summer don’t look particularly hot either."
