UK house prices stall: annual growth halves to 0.8% and prices slip over the month

Nationwide’s house price index for September, published on 1 October 2026, shows the UK market close to a standstill. Prices were 0.8% higher than a year earlier. A month before, the same figure was 1.6%. It is the weakest annual rate since December 2025.

Over September itself prices did not rise at all — they fell 0.2% on a seasonally adjusted basis. The average price stands at £274,251.

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The headline numbers

• annual growth — 0.8% (1.6% in August);
• monthly change — −0.2%;
• average price — £274,251.

Nationwide builds its index from its own mortgage approvals, so cash purchases are excluded. Its figures therefore differ slightly from the official UK House Price Index, which is based on Land Registry data and comes out later. The direction of travel is usually the same, and Nationwide has the advantage of being first — it publishes on the first working day of each month.

Why growth stopped

Robert Gardner, Nationwide’s Chief Economist, puts the subdued market down to uncertainty. Geopolitical tension and conflict in the Middle East are pushing energy prices up, which feeds inflation expectations and in turn puts upward pressure on mortgage rates. A buyer who suspects the monthly payment could be higher than it looked in spring simply waits.

The other half of the picture is calmer. Private sector wage growth, Gardner says, has remained modest, which "should give policymakers breathing space to assess the extent to which tighter policy is necessary". In plain terms: if pay is not driving inflation, the Bank of England has less reason to keep rates high.

Affordability is quietly improving

For anyone saving for a first home, slower price growth is good news. Gardner is explicit: "underlying affordability is improving, as house price growth has been well below earnings growth for some time". When pay rises faster than prices, the deposit you need stops running away from you.

The caveat: higher mortgage rates have only partially offset that gain. Nationwide’s own conclusion is that if energy prices settle and confidence returns, activity should pick up.

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Where prices rise and where they fall

Regional figures are published quarterly. Here is the third quarter of 2026 — average price and annual change:

• Northern Ireland — £227,922, +5.9% (strongest in the UK);
• North West — £231,360, +3.9%;
• Scotland — £196,215, +3.3%;
• North — £174,731, +3.3%;
• Yorkshire & The Humber — £217,029, +1.2%;
• Wales — £214,816, +0.7%;
• West Midlands — £252,355, +0.6%;
• London — £529,720, +0.4%;
• Outer South East — £337,137, 0.0%;
• Outer Metropolitan — £427,430, −0.2%;
• South West — £305,180, −0.3%;
• East Midlands — £237,449, −0.5%;
• East Anglia — £272,119, −0.7% (weakest).

The pattern is easy to read: cheaper regions are rising, expensive ones are flat. London, at an average £529,720, gained less than half a percent over the year — which means that in real terms, after inflation, London property got cheaper.

Flats flat, terraces up

The spread between property types was wider than the spread between regions. Terraced homes rose 1.8% over the year, the strongest category. Flats were essentially unchanged.

That is a long-running trend rather than a one-month quirk. Since 2020 flats have gained 14% while semi-detached houses have gained 31% — more than twice as much. Nationwide partly attributes the gap to London, which has a large share of the flat market and has underperformed for years.

For a buyer this matters practically. A flat looks cheaper to get into, but over the past six years it has been the weaker store of value — and it comes with service charges and ground rent that a house does not.

What to do about it

Buying your first home. Slower price growth works in your favour while pay rises faster than prices. Check the support schemes — see our guides to first-home schemes and the Lifetime ISA and its 25% government bonus.

Coming to the end of a fixed rate. This is more urgent than the paper value of your home. Start shopping around six months before the fix ends — see what to do when your mortgage fix ends.

Renting. A pause in sale prices does not mean a pause in rents; that is a separate market. See our figures on private rents and the guide to challenging a rent increase.

The next fork in the road for the market is the Autumn Budget on 28 October, where any change to property taxes would be announced. Nationwide’s next index lands on the first working day of November.