Annual UK house price growth slowed to 2% in June, down from 3% in May, according to the Office for National Statistics (ONS). The average UK home now costs £272,000.
Regional variations
In England, the average house price reached £293,000, representing 1.8% annual growth. Wales saw an average of £213,000 (1.8% growth), while Scotland recorded £195,000 (2.3% growth). Northern Ireland had the highest annual inflation rate at 9.2%, with an average price of £202,000 in the second quarter of 2026 — the highest since the fourth quarter of 2022.
ONS head of housing market indices Aimee North said: “Annual UK house price inflation slowed significantly in June because price growth was weaker this summer than it was last year following stamp duty changes in England and Northern Ireland.”
London continues to fall
In contrast to early summer 2026, strong price growth was recorded in May and June 2025 as average price levels rebounded after a sharp fall in April 2025, the report said. England’s North West had the highest house price inflation at 4.7% in the 12 months to June, while London recorded the lowest at 2.5%, though the rate of fall slowed from 3.1% in May. It is the 10th consecutive month of annual falls in the capital, mainly driven by decreases in inner London.
Inflation and mortgage outlook
The figures were released as the ONS said Consumer Prices Index (CPI) inflation accelerated to 2.9% in July, up from 2.6% in June. David Hollingworth, associate director at L&C Mortgages, said: “The increase is largely in line with market expectations, which is important from a mortgage borrowers’ perspective.” He added: “There remains a volatile backdrop and it’s impossible to rule out more yo-yoing in mortgage rates at this stage.”
The ONS also reported that the average monthly private rent in the UK was £1,393 in July — around £50 (3.7%) higher than a year earlier. Jeremy Leaf, a north London estate agent, said: “The rental data confirms what we have seen on the ground – that demand remains strong, particularly for higher-end houses among those returning from holiday seeking accommodation before the new school term.”
Industry reactions
Nicky Stevenson, managing director of Fine & Country, said: “With homes taking longer to sell and more properties competing for buyers’ attention, realistic pricing is becoming increasingly important.” Nathan Emerson, chief executive at Propertymark, said: “While short-term fluctuations are a normal part of the property market, they can influence confidence and lead some homeowners to delay decisions until there is greater certainty about the direction of the market.”
Iain McKenzie, chief executive of the Guild of Property Professionals, said: “Looking ahead to the autumn, we expect activity to pick up as the usual seasonal bounce returns, provided mortgage rates continue to ease and economic uncertainty does not intensify.” Ian Futcher, a financial planner at Quilter, said: “If lender competition continues and borrowing costs can gradually ease, activity should remain supported, but a swing the other way could see the market stall once again.”
Richard Donnell, executive director of research at Zoopla, said: “People are renting for longer, which will support demand for rented homes and steady growth in rents, particularly as we come into the busy time of year for the rental market as students and those starting new jobs compete for a still scarce supply of rented homes.” Sarah Coles, head of personal finance at AJ Bell, said of the house price figures: “It’s a useful reminder for anyone considering investing in property that there will be years when your investment doesn’t keep pace with inflation.”
