Average UK house price climbs past £300k after strongest monthly rise in over a year

Year-on-year, prices stand 1 per cent above their January 2025 level. The figures suggest the housing market has found its footing after a wobble at the close of last year.

It is worth noting that Halifax's average sits considerably higher than Office for National Statistics data, which places the typical home at £271,000.

Amanda Bryden, head of mortgages at Halifax, said: "The housing market entered 2026 on a steady footing, with average prices rising by +0.7 per cent in January, more than reversing the -0.5 per cent fall seen in December.

"Annual growth also edged higher to +1.0 per cent, pushing the cost of the typical UK home above £300,000 for the first time."

She acknowledged that "affordability remains a challenge for many would-be buyers" despite this milestone.

However, Bryden pointed to supportive economic factors, noting that "wage growth has been outpacing property price inflation since late 2022, steadily improving underlying affordability".

She added that mortgage deals below four per cent are now increasingly available, with further reductions expected if inflation continues to moderate.

Nicholas Finn, Managing Director of Garrington Property Finders, described the January figures as "a return to business as usual".

He noted that the current momentum centres more on activity than price increases, with estate agents experiencing a busy start to the year as buyers who paused their searches in 2025 re-entered the market.

Regional disparities remain evident, however. Halifax's data reveals that average prices dropped by more than one per cent across all four of England's priciest regions over the past twelve months.

"With a surfeit of supply even in some highly desirable areas, buyers are still dictating the tempo on prices," Finn observed, highlighting competitive conditions in Wales and southern England.

Mortgage rates declined in January and are anticipated to fall further in the months ahead, with the Bank of England adopting an increasingly dovish stance.

The central bank held rates steady yesterday but is expected to cut borrowing costs twice this year.

This easing of lending conditions is drawing discretionary buyers back to the upper end of the market, while renters who delayed purchasing amid last year's uncertainty are now reconsidering their options.

Finn described the opening weeks of 2026 as "an encouraging start" that could herald a robust spring market. Halifax forecasts prices will rise between 1 per cent and 3 per cent over the course of the year.