The annual rate of growth in UK house prices halved to 0.8% in September, from 1.6% in August, according to an index. The average property value fell by 0.2% month on month in September, following a 0.2% increase in August, Nationwide Building Society said.
Across the UK, the average house price in September was £274,251.
Subdued market activity
Robert Gardner, Nationwide’s chief economist, said: “September saw UK annual house price growth halve to 0.8%, the weakest rate of growth since December 2025.”
He added: “Market activity and house prices have remained subdued in recent months, in part reflecting the uncertain economic backdrop.”
Geopolitical tensions and inflation
“Geopolitical tensions remain high, with the conflict in the Middle East exerting upward pressure on energy prices, fanning inflation concerns,” Mr Gardner said.
“This in turn has led to mounting financial market expectations of (Bank of England base rate) increases, which has maintained upward pressure on the market interest rates which underpin mortgage pricing.”
Affordability improving
Mr Gardner said that underlying housing affordability is improving, “as house price growth has been well below earnings growth for some time”.
He said: “These gains have been only partially offset by higher mortgage rates.”
“This suggests that activity should regain momentum in the quarters ahead providing the energy shock fades and confidence returns – especially if market interest rates fall back to pre-conflict levels.”
