Average UK house prices increased by 2%, to £272,000, in the 12 months to June 2026, down from 3% in the 12 months to May, according to the latest UK House Price Index from the Office for National Statistics (ONS).
Average house prices increased to £293,000 (1.8%) in England, £213,000 (1.8%) in Wales, and £195,000 (2.3%) in Scotland. ONS attributes the slowdown to weaker growth following the April 2025 stamp duty changes.
Nicky Stevenson, managing director of estate agents Fine & Country, said the growth doesn’t point to a market in retreat. “Instead, it reflects the growing influence of buyer affordability, increased choice and a more cautious economic backdrop.”
What is encouraging, she added, “is that transactions have stabilised and mortgage approvals have improved, suggesting that there remains a solid underlying appetite to move.
“Buyers have not disappeared, they are simply more selective.”
Iain McKenzie, CEO of The Guild of Property Professionals, said the slowdown reflects pressures in the market but warned it would be wrong to interpret softer price growth as a lack of resilience.
He explained: “Mortgage approvals increased in June, mortgage product availability has continued to improve, and major lenders have begun reducing rates on residential mortgages again. Property transactions also stabilised, with activity in the first half of the year remaining ahead of 2024 and only modestly below last year’s levels.
“Looking ahead to the autumn, we expect activity to pick up as the usual seasonal bounce returns, provided mortgage rates continue to ease and economic uncertainty does not intensify.”
Paige Tao, economist at PwC UK, said affordability remains the main constraint on demand: “While wages are outpacing house prices, higher mortgage costs are absorbing much of that gain, as borrowing costs reached their highest level in more than a year in June.
“With housing demand particularly sensitive to borrowing costs, a durable recovery in activity will likely require mortgage rates to settle lower. That in turn depends on an inflation outlook that remains unclear, and on how soon the Bank of England feels able to respond.”
But there are reasons for cautious optimism, Tao added. “While the first six months of 2026 was more challenging than many expected, the UK economy has proved remarkably resilient.
“June’s 0.3% rise in GDP provides a firmer starting point for the months ahead, while the new prime minister has an opportunity to put housing affordability and new supply higher up the agenda.”
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts, said the picture of a subdued housing market doesn’t tell the whole story. The picture on the ground, she explained, is more positive.
“Certainly, in our part of the world in Richmond, the market seems to be through the worst of the correction. Prices aren’t rising rapidly, but they are stabilising, and the underlying level of applicant demand we have seen over the summer gives me some cautious optimism for the autumn.
“Applicant registrations have been higher than usual – we’ve seen a 52% increase in applicants registering in Richmond year-on-year compared with a 1% fall across London.”
She added: “There is still a strong underlying desire to move.”
On the news that consumer price inflation rose by 2.9% in the 12 months to July 2026, up from 2.6% the previous month, Propertymark CEO Nathan Emerson said: “Today’s news may bring a renewed level of concern to many individuals and families, especially over the coming months regarding household outgoings.
“Significant fiscal uncertainty, both in the UK and globally, including concerns on energy prices over coming months, is potentially likely to keep inflation rates above pre-2021 levels for now, continuing to potentially impact affordability for existing homeowners and prospective buyers as the year progresses.”
