New data from Halifax has revealed a significant milestone in the UK property market, with average house prices climbing above £300,000 for the very first time. The figures show a one per cent annual increase, pushing the typical home value to £300,077, though this masks substantial regional variations across the country.
Southern Regions See Price Declines
While the overall national picture shows growth, the data reveals a contrasting story in southern England. London continues to command the highest prices by a considerable margin, with an average property value of £538,600. However, this represents a notable decline of 1.3 per cent compared to January 2025.
The South East follows with average prices of £385,086, experiencing a 1.6 per cent decrease over the same period. Similarly, the South West has seen prices fall by 1.6 per cent to £303,625, demonstrating a clear pattern of cooling in traditionally expensive markets.
Northern Ireland and Scotland Lead Growth
In stark contrast, Northern Ireland has recorded the strongest annual price growth across all UK regions at 5.9 per cent, despite having some of the most affordable average prices at £217,206. Scotland has followed a similar trajectory, with prices increasing by 5.4 per cent to reach £221,711, highlighting a significant north-south divide in market performance.
Market Shows Resilience Despite Challenges
Amanda Bryden, Head of Mortgages at Halifax, commented on the findings, stating: "The housing market entered 2026 on a steady footing, with average prices rising by 0.7 per cent in January, more than reversing the 0.5 per cent fall seen in December."
"Annual growth also edged higher to 1.0 per cent, pushing the cost of the typical UK home above £300,000 for the first time," she added. "While that's undoubtedly a milestone figure, and activity levels show a resilient market, affordability remains a challenge for many would-be buyers."
Economic Factors Provide Support
Ms Bryden pointed to several positive economic indicators supporting the market: "Broader economic conditions continue to provide some support. Wage growth has been outpacing property price inflation since late 2022, steadily improving underlying affordability."
"That's a positive trend for buyers, and the long-term health of the market. And we're now seeing more mortgage deals below 4 per cent. If inflation continues to ease, there should be further gradual reductions as the year goes on," she explained.
Looking ahead, Halifax maintains a cautiously optimistic outlook: "All in all, we still think house prices are likely to edge up between 1 per cent and 3 per cent this year."
Industry Calls for Targeted Support
Nathan Emerson, CEO of Propertymark, welcomed the improving market conditions but highlighted ongoing concerns: "As we progress further into the year, it is encouraging to see the housing market gathering pace. We are witnessing an increased flow of homes being brought to market, alongside growing confidence among buyers and sellers as they approach the moving process."
However, he emphasized the persistent affordability crisis: "Affordability remains a key issue for many. To turn improving market conditions into meaningful access to homeownership, buyers need targeted support, a stable lending environment and policies that directly address affordability pressures across all tenures."
The data reveals a complex and divided property landscape, where regional disparities are becoming increasingly pronounced even as the national average reaches new heights.
