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UK house prices rose for the fifth month in a row in November to hit a new record high of £298,083, according to Halifax (LLOY.L).
Property values rose by 1.3% month on month, but on an annual basis house prices increased by 4.8% in November, accelerating from 4% growth in October.
The price surge is being driven by improving mortgage demand, as recent reductions in interest rates bolster buyer confidence. However, affordability remains a challenge for many potential buyers, according to one of the country’s biggest mortgage lenders.
Amanda Bryden, head of mortgages at Halifax, said: “UK house prices rose for the fifth month in a row in November, up by 1.3% in the month — the biggest increase so far this year. This pushed the annual growth rate up to 4.8%, its strongest level since November 2022. As a result, the record average house price we saw in October edged higher still, with a typical property now costing £298,083."
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She added: “Latest figures continue to show improving levels of demand for mortgages, as an easing in mortgage rates boosts buyer confidence. However, despite these positive trends, many potential buyers and movers still face significant affordability challenges, and buyer confidence may be tested against a changeable economic backdrop."
Looking ahead, Bryden anticipates that positive employment data and further interest rate reductions will continue to support demand in the housing market, although she warned that house price growth may slow, given the elevated borrowing costs compared to historical norms.
Karen Noye, mortgage expert at Quilter, said: “The rise in house prices will offer some relief to existing homeowners who may have been concerned about a prolonged market downturn. Yet, questions remain about how sustainable this recovery might be.
"The Bank of England’s recent decision to reduce interest rates to 4.75% has eased some of the pressure on mortgage holders, but for many households refinancing in the coming months, monthly repayments will still rise significantly compared to previous fixed-rate deals."
Across the UK’s nations and regions, house price growth remains uneven. Northern Ireland has again recorded the strongest annual increase, with prices rising by 6.8% year on year. The average house price in the region now stands at £203,131, outpacing all other areas.
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Wales also saw strong price growth, with house prices up by 4.1% annually, bringing the average price to £225,084. Similarly, the North West of England saw significant growth, with property prices rising by 5.9% to an average of £237,045.