Author:
Ella Boyd
Financial Commentator,
Saltus Asset Management Team
Reviewed by: Megan Jenkins, Chartered Financial Planner, Saltus Asset Management Team
After a period of relative stability, UK house prices saw a slight decline in September, falling by 0.3% month on month (around £794), according to the latest data from Halifax.[1] The annual rate of house price growth eased to 1.3%, falling from 2% in August reflecting a subdued market grappling with broader economic headwinds.[2]
The eagle-eyed among you, however, may have noticed that Nationwide’s data told a different story for the same period, reporting a 0.5% monthly increase, with annual growth ticking up slightly to 2.2%, from 2.1% in August.[3]
So, why is there a discrepancy in the data and what can we learn from it?
Understanding the difference in data
At first glance, the conflicting reports from two of the UK’s biggest lenders may seem confusing. But the variation highlights an interesting point, that house prices are estimates and not absolutes. Each lender uses different data and methodologies. The indices for Nationwide and Halifax are based purely on their own mortgage applications at the approval stage. While this means their data can be more timely, some applications may not be completed so they have the potential to provide a biased estimate of sale prices.[4] Halifax also has a larger data pool compared to Nationwide, (15,000 vs 12,000).
For the most accurate view of house price movements, the UK House Price Index (UK HPI) is considered the gold standard. It draws from completed transactions recorded by HM Land Registry, Registers of Scotland, and Land and Property Services Northern Ireland. However, this data comes with a significant time lag, typically several months, making it more useful for retrospective analysis.4 Looking ahead, we will receive the definitive September 2025 house-price figures in November 2025, when HM Land Registry makes its dataset of completed sales public.
What’s behind the stagnation?
Although Halifax and Nationwide show differing short term movements, the broader picture points to a broadly stagnant market, with house prices neither rising rapidly nor falling sharply. While not a dramatic correction, they reflect a period of softness with house purchases hovering around 65,000 cases per month, similar to the average pre-pandemic in 2019.[5][6]
A couple of factors may be at play:
- Interest rates remain elevated: While the Bank of England has paused further interest rate hikes, mortgage affordability remains a challenge for many buyers. Higher borrowing costs continue to weigh on demand. That said, there are signs of gradual improvement in affordability. Currently, the average two year fixed mortgage rate stands at around 4.37% in September 2025 – a modest decline from levels above 5% seen in mid-2024.[7]
- Seasonal Trends: Historically, the property market tends to cool in August and early autumn. Some of the current dip may simply reflect this annual cycle.[8]
However, beneath the headline figures is a key driver: much of the apparent stagnation stems from the performance of higher-value homes.
According to recent data from Zoopla, demand for homes priced over £500,000 has dropped by 4% compared to the same period last year. New listings in this price bracket have also fallen by 7%, with the impact even more pronounced for properties over £1 million.[9]
This softening at the top end of the market is likely being driven by pre-Budget uncertainty. With the 2025 Autumn Budget looming closer (you can read our Budget predictions here: The Autumn Budget 2025 : Predictions and possibilities | Saltus), speculation around potential changes to stamp duty, mansion tax, or other property levies may have caused some buyers and sellers to pause their plans.[10] In times of fiscal uncertainty, this type of “wait and see” behaviour is not uncommon.[11]
What it means for financial planning?
While it can be fairly easy to get caught up in short term fluctuations, overall current market conditions remain relatively mild and stable. This isn’t a cause for concern, but rather a moment to take stock and plan proactively. Depending on your situation, you may want to consider the following:
- For homeowners, property remains a long term asset. However, it might be wise to review your mortgage if you’re nearing the end of a fixed rate. And if you were planning to sell in the near future, a conversation with a financial adviser can help you assess the best route forward.
- For buyers, a quieter market could offer more room for negotiation. Lenders are still active, and deals may be able to be found.
- For investors, the fundamentals matter more than short term price movements. If you’re considering a buy-to-let or diversifying your portfolio, now might be a suitable time to re-evaluate your strategy with a focus on yield and resilience. As always, financial advice can be valuable in helping you make well-informed decisions.
Putting the market into perspective
Whether house prices rise by 0.5% or fall by 0.3% in a given month is less important than ensuring your financial plan is robust and adaptable to your changing needs. If you feel uncertain about current market conditions, taking a longer term view and seeking advice tailored to your circumstances is key.
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All authors have considerable industry expertise and specific knowledge on any given topic. All pieces are reviewed by an additional qualified financial specialist to ensure objectivity and accuracy to the best of our ability. All reviewer’s qualifications are from leading industry bodies. Where possible we use primary sources to support our work. These can include white papers, government sources and data, original reports and interviews or articles from other industry experts. We also reference research from other reputable financial planning and investment management firms where appropriate.