Average UK house prices exceeded £300,000 for the first time in January 2026, reaching £300,077 according to Halifax data. Despite the milestone, affordability is improving as wage growth outpaces house price inflation.
The £300,000 Milestone
House prices rose 0.7% in January 2026, according to Halifax's latest House Price Index, taking the average UK property price to £300,077 — the first time it has exceeded £300,000.
The increase follows a 0.5% decline in December, with annual price growth now standing at 1%, up from 0.4% the previous month. House prices have climbed by nearly 19% in the three years between 2020 and 2023, fuelled by ultra-low mortgage costs and increased demand for space following the pandemic.
While £300,000 marks a significant psychological milestone, Halifax notes that affordability remains a major challenge for many aspiring homebuyers. However, there are positive signs on the horizon.
Signs of Improving Affordability
Despite the headline figure, broader economic conditions are providing some support for buyers. Wage growth has been outpacing property price inflation since late 2022, steadily improving underlying affordability. This is a positive trend for buyers and for the long-term health of the market.
More mortgage deals are now available below 4%, and if inflation continues to ease, there should be further gradual rate reductions as the year progresses. Most forecasters expect house prices to edge up between 1% and 3% this year — modest growth that keeps the market accessible.
Lenders are also introducing new products to support first-time buyers, with some offering 98% mortgages for those struggling to save a larger deposit.
Regional Differences Becoming More Pronounced
Although the headline average can seem daunting, house prices vary enormously across the UK. Many locations offer far more accessible price points, especially in northern regions where homes can often be found for under £200,000.
A widening divide in house price performance is emerging between northern and southern regions:
- Northern Ireland: the standout performer, with prices up 5.9% annually to £217,206
- Scotland: strong gains of 5.4% annually, pushing the average to £221,711
- Wales: more subdued growth of 0.5%, with an average price of £228,415
- South East, South West, London & Eastern England: prices declined by more than 1% annually — notable given these are the four most expensive regions
For first-time buyers in particular, looking beyond the headline average and exploring more affordable regions can make the difference between getting on the ladder and continuing to rent.
Frequently Asked Questions
- Will house prices keep going up in 2026?
- Most forecasters expect modest growth of 1-3% in 2026. Rising supply, subdued demand in expensive regions, and still-elevated mortgage rates are keeping price growth in check.
- Where are the most affordable areas to buy in the UK?
- Northern regions, including parts of Northern Ireland, Scotland, the North East, and North West of England, offer significantly more affordable house prices than London and the South East.
- Can I buy a house with less than a 5% deposit?
- Some lenders now offer 98% mortgages requiring just a 2% deposit, though these come with higher rates. The more deposit you can save, the better the deals available to you.
Sources & References
- Halifax House Price Index — Halifax
- Earnings data — ONS
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