House Prices Climb Faster Than Predicted in September
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Unexpected House Price Growth for September Signals Strength in Property Market
UK house prices saw a stronger-than-expected rise in September, with the latest Nationwide House Price Index revealing a strong monthly and annual increase.
This positive news signals that despite economic uncertainty, the UK property market is showing resilience.
Learn more about how UK property prices have risen and what we could expect from the rest of the year.
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Monthly and Annual Growth Exceeds Forecasts
Experts had recently expected slow house price growth for the UK property market, with Halifax predicting ‘modest’ capital growth rates for the latter half of 2025 back in July.
These latest figures from Nationwide, however, report a stronger-than-expected property price growth, with the average UK house price growing from £271,079 in August to £271,995 by September.
This 0.5% price rise is up compared to a -0.1% increase seen in August, and shows an annual increase of 2.2%.
Steady Market Activity
Property market activity is proving to be steady. The number of mortgages approved for purchase—around 65,000 cases each month for the past quarter—remains close to the pre-pandemic average, even in the face of higher borrowing costs.
This suggests that UK housing demand is being sustained by robust employment and wage growth, along with stabilising interest rates following earlier hikes from the Bank of England.
The report from Nationwide reveals that buyers are gradually returning to the market, encouraged by improved wage growth and steady employment numbers.
Robert Gardner, Nationwide’s Chief Economist, noted:
“Despite ongoing uncertainties in the global economy, underlying conditions for potential home buyers in the UK remain supportive. Unemployment is low, earnings are rising at a healthy pace, household balance sheets are strong, and borrowing costs are likely to moderate a little further if Bank Rate is lowered in the coming quarters as we, and most other analysts, expect.”
Outlook: Gradual Strengthening
Looking forward, the rest of 2025 could see further property market strengthening if wage growth and unemployment remain robust. The market appears well-positioned for an optimistic recovery as we end the year.
As outlined in the recently updated Savills Residential Property Market Forecast, the UK is expected to see an average 1% increase in house prices for 2025. Judging by the reported 0.5% increase within one month alone, it’s possible that by the end of the year, average UK property prices may have surpassed this initial prediction.
As always, certain UK areas should expect stronger capital growth rates. Nationwide’s report shows that the highest growth was recorded in Northern Ireland, Yorkshire and the Humber, and the North West. This aligns well with Savills’ predictions that show a higher expected growth for Northern regions, including a 2.5% annual growth prediction for the North West, compared to areas in the South.
Explore Our UK Investment Opportunities
If you’re considering investing in property in the UK, now is a great time to enquire. We have some fantastic investment deals currently available, from discounted direct-from-developer deals on completed units, to exciting new launches such as our latest Liverpool project, Grand Union. Contact us today and kickstart your UK buy-to-let venture.
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