The average price of a home in the United Kingdom has climbed above £300,000 for the first time on record, according to the latest data from mortgage lender Halifax, marking a milestone in the housing market as it enters 2026. Halifax’s House Price Index showed that the typical UK property was valued at £300,077 in January, after monthly price growth of 0.7 per cent — the strongest rise since November 2024 — more than reversing a 0.5 per cent drop in December. Annual growth also accelerated to 1.0 per cent, up from 0.4 per cent the previous month, illustrating renewed momentum in a market that had been subdued in late 2025.
Industry analysts described the jump past the £300,000 mark as symbolic but warned that it also highlights enduring affordability challenges for many prospective buyers. Amanda Bryden, head of mortgages at Halifax, said the start to 2026 showed the market “entered the year on a steady footing,” with activity levels demonstrating resilience despite ongoing cost pressures. However, she emphasised that affordability remains stretched for a significant portion of would-be buyers, particularly as broader economic conditions continue to exert influence on lending and purchasing decisions.
The Halifax figures form part of a broader picture of uneven regional performance. While some parts of the UK posted strong gains, others lagged or even saw price declines over the past year. Northern Ireland led annual growth with increases of nearly 6 per cent to an average price of around £217,000, followed by Scotland at about £221,700. Regions in northern England, such as the north-west, also showed robust annual growth of roughly 2.1 per cent. By contrast, several southern areas including London, the South East and South West reported annual declines in property values of more than 1 per cent, underscoring a persistent north-south divide in the housing market.
Experts said the rebound in prices has been supported by a series of interest rate cuts by the Bank of England during 2024, making mortgage financing relatively more accessible, although borrowing costs remain high by historic standards. The Bank held its base rate at 3.75 per cent in December amid concerns about inflation, which ticked up to 3.4 per cent, but the narrow vote among policymakers has led some analysts to anticipate further rate reductions this year. Wage growth outpacing house price inflation since late 2022 has also helped ease the pressure on affordability in some segments of the market.
Looking ahead, Halifax expects house prices to continue rising modestly in 2026, forecasting between a 1 per cent and 3 per cent increase over the year if current economic conditions persist. Other market forecasters have projected similar growth, though they caution that political and economic uncertainties could influence trends in either direction. Despite record headline figures, the relative cost burden for first-time buyers and those in high-priced regions remains a significant factor shaping demand and market dynamics.
