Average house price held relatively steady in February, with prices dipping by -0.1%, compared to a growth of 0.6% in January, data from Halifax’s latest House Price Index has revealed.
The average property price was recorded at £298,602, compared to £298,815 a month previous.
Annual growth remained at 2.9%, unchanged from January.
On a regional level, most areas of the UK saw a slowdown in house price inflation in February.
Bucking the trend most notably was Scotland, which saw annual growth increase to 3.8% compared to 2.5% in January, with an average house price of £213,014.
Northern Ireland continued to have the strongest annual property annual price growth in the UK, largely unchanged at 5.9% in February.
Properties in Northern Ireland costed an average of £205,784.
House prices in Wales were up 2.8% compared to the previous year, with properties valued at an average of £226,811.
In England, Yorkshire and Humberside recorded the strongest annual property price growth for the first time since July 2021, up 4.1% compared to the previous year, with properties now costing an average £216,130.
London saw annual house price growth ease considerably from 2.6% in January to 1.6% in February.
The capital still boasted by far the most expensive average property price in the UK, at £545,183.
Amanda Bryden, head of mortgages at Halifax, said: “February’s figures highlight the delicate balance within the UK housing market.
“While there’s been talk of a last minute rush on new mortgages ahead of the changes to Stamp Duty, inevitably we’ve seen some of the demand that was brought forward start to fade as the April deadline ticks closer, given the time needed to complete a purchase.
“That may help to explain why growth in first-time buyer property prices eased in February, falling to 2.4%, in contrast to homemover price inflation which accelerated, reaching 3.7%
“While house price growth has slowed overall, market activity remains strong and comparable to pre-pandemic levels, demonstrating a resilience amongst buyers that’s been evident in the face of higher borrowing costs.”
She added: “While those affordability challenges persist, the ongoing shortage of housing supply coupled with sustained demand suggests property prices will continue to rise this year, albeit at a more measured pace compared to last year.”
Reaction:
Marc von Grundherr, director of Benham and Reeves:
“Despite mortgage rates remaining higher than today’s buyers have become accustomed to, the property market has remained resilient in the face of uncertainty.
With the winter months now behind us, it’s onwards and upwards from here as we approach the spring selling season and the busiest time of year for market activity and as more buyers look to make their move in 2025, house prices will remain stable and continue along their upward trajectory.”
Stephanie Daley, director of partnerships at Alexander Hall:
“We’ve seen no sign of market momentum slowing so far in 2025, with house prices remaining stable over the start of the year.
“Whilst the impending Stamp Duty deadline has been a contributing factor behind an increased level of market activity, we’ve seen many buyers factor in a potential cost increase from the off, which suggests that any correction that does come as of the 1st April will be minimal.
“Therefore, the expectation is that the market will continue to go from strength to strength as we approach the busy summer selling season, with buyer sentiment strengthened further by the prospect of further interest rate reductions.”
Verona Frankish, CEO of Yopa:
“The UK property market has continued to stand strong with house prices remaining higher than this time last year, driven in part by the rush to beat the stamp duty deadline at the end of this month.
“Whilst the average home buyer is set to see Stamp Duty costs increase by £2,500 as of April, this is unlikely to deter them from their quest to climb the property ladder and so we expect to see further growth materialise as the year progresses.”
Jonathan Samuels, CEO of Octane Capital:
“There’s no doubt that the Bank of England’s decision to cut interest rates so early in the year has helped to boost property market sentiment and we’ve seen a number of lenders react positively by reducing the rates on offer to the nation’s homebuyers.
“However, since the Autumn Budget we have seen inflation rear its head and start to climb, which could delay further rate cuts over the course of this year.
“Only time will tell, but as it stands, buyers and sellers should be reassured that now is as good a time as any to enter the market.”
Mark Harris, chief executive of mortgage broker SPF Private Clients:
“Average house prices are holding steady as borrowing costs, which albeit have softened recently, remain higher than many buyers were paying not that long ago.
“With the Bank of England cutting interest rates last month, and the expectation of further reductions to come, this should give buyers renewed confidence to make their move.
“Swap rates have been declining slowly, enabling several lenders including Nationwide and Barclays to reintroduce those psychologically-important sub-4% mortgages.
“However, the market remains jittery and with swaps jumping again over the past couple of days, wiping out much of the recent declines, the cheapest deals may not hang around for long. Borrowers should seek advice and move quickly to secure a rate they like the look of.”
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts:
“On the ground, we have noticed the recent drop in mortgage rates has boosted buyer confidence but affordability continues to be the dominant factor.
“As the sun continues to shine, more stock is coming to market as family homes with gardens in particular start to look their best.
“Well-priced and well-presented homes are selling relatively quickly; while buyers may be pausing to assess financial implications before taking the plunge, high-demand areas are retaining interest.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman:
“A strong appetite to buy for some is almost matched by others wanting to ensure the increasing availability of stock has been properly appraised and best terms negotiated before proceeding.
“Prices, especially for houses, are holding up well, supported by income growth exceeding inflation but will come under pressure, particularly now it is probably too late to take advantage of the Stamp Duty concession.
“Employer concerns about increasing national insurance and minimum wage commitments are not helping confidence either.”
Tomer Aboody, director of specialist lender MT Finance:
“With a largely stable housing market, and indeed slight growth in evidence, we are seeing the reaction from buyers who are being cautious due to the uncertainty around inflation, but are looking to push ahead as mortgage rates are lower than they have been.
“As Stamp Duty changes are upon us, many buyers and sellers are either trying to scramble to complete transactions or are waiting tentatively to see if the Bank of England reacts with further rate cuts, which have been discussed.”
Daniel Austin, CEO and co-founder at ASK Partners,:
“Despite a rise in house prices, we believe that growth is likely to face pressure and remain steady, as higher borrowing costs start to affect buyers, despite the market’s continued resilience.
“Investors and developers in the residential sector remain motivated by the supply demand imbalance and under the new Government, we think there will be more projects that get off the ground.
“We are seeing a greater variety of housing options, such as co-living schemes, coming to market which fulfil the growing requirements of younger professional buyers.
“If prices flatten and interest rates start to fall, we will see more first-time buyers able to step onto the property ladder.”
Babek Ismayil, founder and CEO, homebuying platform OneDome:
“There’s a race against the clock driving the market at the moment, with home-buyers battling to beat the Stamp Duty deadline.
“Changes to the threshold on 1st April means that aspiring homeowners are doing their best to complete their transaction, but the system isn’t fit for purpose.
“Some of that rush is starting to pass now, and today’s data shows house prices holding steady in February.
“This is a pattern we’ve seen accompanying recent tax changes, and we’ll expect prices to soften again once the deadline has passed.
“Looking ahead, further cuts to interest rates could be on the horizon, which could boost the property market as buyers react to reduced mortgage payments.
“A bigger problem is that the current system is groaning at the seams as estate agents and solicitors battle to deal with the demand.
“Buying a home is stressful enough, but the pressure is becoming intolerable for first-time buyers, with financing issues, paperwork delays and last-minute negotiations combining to create a pressure cooker effect.
“Homeowners are crying out for a more streamlined process with agents, conveyancers and brokers working together. Bringing all parts of the transaction process under one roof would solve this issue.”
