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GB: Lloyds House Price Index
| Actual | Previous | Revised | |
| Month over Month | -0.6% | 0.0% | -0.1% |
| Year over Year | -1.2% | 0.0% | -0.1% |
Highlights
The UK housing market experienced a further deterioration in October 2026, reflecting weakening buyer confidence, elevated borrowing costs and persistent pressure on household finances. House prices declined by 0.6 percent month-over-month, following September’s 0.1 percent contraction, reducing the average property value to £296,285. Annual prices fell by 1.2 percent, marking the steepest decline since October 2023.
Renewed inflationary pressures, exacerbated by the prolonged Middle East conflict and rising energy costs, have constrained household purchasing power and mortgage affordability, encouraging prospective buyers to postpone property purchases.
However, regional disparities remain pronounced. Northern Ireland recorded the strongest annual growth at 4.4 percent, despite slowing from 6.9 percent, followed by Scotland (2.8 percent) and Wales (1.6 percent). Within England, the North West (2.2 percent) and North East (2.0 percent) demonstrated relative resilience, contrasting sharply with Greater London (minus 3.1 percent) and the South East and South West (both minus 2.4 percent).
In summary, the housing market remains characterised by subdued demand and widening regional divergence. Although elevated financing costs may prolong near-term weakness, continued wage growth exceeding house price inflation could gradually improve affordability, providing a foundation for eventual market stabilisation.
Definition
The Halifax House Price Index (HPI) is the UK's longest running monthly house price measure with data covering the whole country going back to January 1983. The index is based on the largest monthly sample of mortgage data, typically covering around 15,000 house purchases per month, and covers the whole calendar month. In March 2016 Markit announced that it would be acquiring the Halifax HPI from Lloyds Banking Group. Halifax continues to publish the index on behalf of Markit and both the name and the basic methodology remain unchanged. However, in May 2020, the annual growth measure was changed from the average of the last three months to just the latest month.
Description
Home values affect much in the economy - especially the housing and consumer sectors. Periods of rising home values encourage new construction while periods of soft home prices can damp housing starts. Changes in home values play key roles in consumer spending and in consumer financial health. During the first half of this decade sharply rising home prices boosted how much home equity households held. In turn, this increased consumers' ability to spend, based on wealth effects and from being able to draw upon expanding home equity lines of credit.