Annual growth in the average UK house price accelerated to 2.2% in June, up from 1.7% in May, Nationwide Building Society has reported. The average UK house price in June was £277,484.
Market Softens Amid Geopolitical Uncertainty
Robert Gardner, Nationwide’s chief economist, said: “Annual house price growth picked up to 2.2% in June, from 1.7% in May, although prices were broadly flat (with a 0.0% change) in month-on-month terms, after taking account of seasonal effects.” He added that it is not surprising the market has softened given uncertainty from developments in the Middle East and subsequent rises in energy prices and market interest rates. Consumer confidence and housing sentiment have weakened, and mortgage approvals fell noticeably in May.
Potential for Recovery
Gardner noted that while geopolitical tensions remain high, the signing of a memorandum of understanding between Iran and the US helped push oil prices back toward pre-conflict levels. If the energy shock continues to subside, the Bank of England may not need to raise interest rates, or at least by less than anticipated. A shift in market expectations has helped bring down market interest rates underpinning fixed-rate mortgage pricing. “If maintained, these trends will help to restore household confidence and ease affordability constraints, paving the way for a recovery in housing market activity in the coming quarters,” he said.
Regional Variations
Amy Reynolds, head of sales at Antony Roberts, described the market as “steady and selective” with a pre-summer push from families. Ian Futcher of Quilter noted that many buyers are delaying major financial commitments due to fragile confidence and fluctuating mortgage rates. Aneisha Beveridge of Connells Group highlighted regional differences: in more expensive markets, households weigh higher mortgage costs and stamp duty, while in northern Britain, affordability is less stretched, supporting higher activity and stronger price growth.
Average House Prices by Region (Q2 2024)
- Northern Ireland: £226,699 (8.6% annual increase)
- North West: £231,415 (3.9%)
- North East: £173,756 (3.9%)
- Scotland: £195,928 (3.5%)
- Wales: £220,337 (3.5%)
- West Midlands: £256,592 (3.2%)
- Yorkshire and the Humber: £217,518 (2.9%)
- East Midlands: £240,482 (1.8%)
- London: £540,903 (1.6%)
- South West: £310,429 (0.7%)
- East Anglia: £274,375 (0.3%)
- Outer Metropolitan: £432,173 (0.3%)
- Outer South East: £341,175 (0.1%)
