Analysis of movement in house price indices

Each month, Halifax, Nationwide and HM Land Registry publish house price indices, tracking the movement in average house prices in the UK. Halifax and Nationwide updates are based on mortgage approvals data, while the UK HPI is a joint production by HM Land Registry, Land and Property Services Northern Ireland, ONS and Registers of Scotland.

House price indices continue to show annual increases

Annual movement in UK house prices was up in October 2024, according to both Halifax and Nationwide’s indices.

Halifax reported a 3.9% annual increase in house prices, while Nationwide’s index showed an increase of 2.4% on the same period.

On a monthly basis, Halifax said prices were up by 0.2% on September 2024, while Nationwide’s index showed a 0.1% increase.

Dr David Crosthwaite, Chief Economist at BCIS, said: ‘Modest house price growth has returned on an annual basis but, as long as uncertainty remains, property developers are not likely to start building homes again at scale.

‘The recent base rate cut will feed into increasing affordability going forward. However, with growth in real wages stagnant and still at pre-financial crisis levels, you have to wonder just how affordable housing currently is.’

Amanda Bryden, Head of Mortgages at Halifax, said borrowing constraints remain a challenge for many buyers.

She said: ‘Following the Budget, markets expect the Bank of England to cut rates more slowly than previously anticipated, which could keep mortgage costs higher for longer. New policies like higher stamp duty for second home buyers and a return to previous thresholds for first-time buyers might also affect demand.

‘While we expect house prices to keep growing, it will likely be at a modest pace for the rest of this year and into next.’

Nationwide’s Chief Economist, Robert Gardner, said housing market activity has remained relatively resilient in recent months, with the number of mortgage approvals approaching the levels seen pre-pandemic.

He said: ‘Providing the economy continues to recover steadily, as we expect, housing market activity is likely to continue to strengthen gradually as affordability constraints ease through a combination of modestly lower interest rates and earnings outpacing house price growth.’

The UK HPI, with the latest data for September 2024, showed a 2.9% increase in house prices compared with September 2023, and a 0.1% decrease on August 2024. As the UK HPI figures cover house sales that may have been agreed months previously, there tends to be a lag in the data.

^{Source: Halifax (Methodology), Nationwide (Methodology), UK HPI (Methodology)}

Regional data from Nationwide shows Northern Ireland and the North West saw the greatest annual increases in 3Q2024, while East Anglia was the only region to show an annual decrease in the same period.

^{Source: Nationwide}

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