UK house prices rose at the start of 2026, with the average property price moving above £300,000 for the first time, according to the data from lender Halifax.
The Halifax House Price Index showed prices increased by 0.7% in January, following a 0.5% decline in December. The average UK home is now priced at £300,077. Annual house price growth rose to 1.0%, up from 0.4% in the previous month.
Amanda Bryden, Head of Mortgages at Halifax, said: “While that’s undoubtedly a milestone figure, and activity levels show a resilient market, affordability remains a challenge for many would-be buyers.”
She said the January increase more than reversed December’s fall and said wage growth has continued to outpace property price inflation since late 2022, helping to support affordability.
Commenting on the data, EY ITEM Club's Matt Swannell said recent strength should be viewed with caution. He said much of January’s increase reflected the reversal of December’s decline and noted that prices had risen by just 0.1% over the past three months.
Swannell said house price growth over the year to January remained modest at 1% and said affordability challenges persist, particularly with the average price moving above £300,000.
He said housing market performance in 2026 is likely to be shaped by wider economic conditions rather than recent changes to property taxes.
ASK Partners CEO Daniel Austin said the data pointed to underlying resilience in the market, but said momentum remains constrained by affordability pressures and the current interest rate environment.
He said mortgage pricing has improved, but said confidence among buyers and developers remains fragile.
Austin said structural factors continue to shape the market, with demand remaining subdued among mainstream buyers while activity flows into rental markets such as build-to-rent and co-living.
He also said elevated construction and financing costs continue to pressure margins.
Regionally, Halifax reported stronger price growth in the north of the UK. Northern Ireland recorded annual growth of 5.9%, taking the average price to £217,206, while Scotland saw a 5.4% increase to £221,711.
In England, the North West recorded annual growth of 2.1%, while several southern regions, including London and the South East, saw annual price declines of more than 1%.