UK house prices rose at their fastest pace since January, with the average cost of a home reaching a record high of £299,862, according to the Halifax house price index. Prices increased by 0.6% month-on-month in October, reversing an unexpected 0.3% drop in September and surpassing the 0.1% monthly rise forecast by economists.
On an annual basis, house prices rose 1.9%, also beating expectations of a 1.5% increase. Amanda Bryden, head of mortgages at Halifax, said buyer demand held up well despite market uncertainty, with new mortgage approvals hitting their highest level so far this year. However, she noted that affordability remains a challenge, with many buyers opting for smaller deposits and longer mortgage terms.
The rise in prices comes ahead of the 26 November budget, where Chancellor Rachel Reeves is reportedly considering replacing stamp duty with a new levy on homes worth over £500,000. Some experts expect a further increase in home-buying activity from December onwards, once the budget provides clarity.
Matthew Thompson, head of sales at estate agent Chestertons, said October's market was calmer as buyers paused to see what the budget might bring. He expects activity to pick up once there is more clarity. Bryden added that with house prices rising more slowly than incomes for almost three years, the trend of gradually improving affordability should continue.
Separately, shares in Rightmove fell as much as 25% after the estate agent warned of a slowdown in profit growth. The company expects underlying operating profit growth to slow to 3-5% in 2026, down from 4-9% in 2024 and 2025, but said AI investment would support long-term growth.
