Welsh house prices rise 1.2% as UK market stalls

Nation.Cymru staff/agencies

House prices in Wales rose by 1.2% annually to an average of £231,287, while prices across the UK showed no growth, according to Lloyds.

The Welsh figures, based on the most recent three months of approved mortgage transaction data, contrast with annual falls across much of England.

Across the UK, the average house price stood at £298,441 in September, with no change either month on month or compared with a year earlier. That followed a monthly fall of 0.3% and an annual decline of 0.4% in August.

Northern Ireland recorded the strongest annual growth at 7.4%, followed by Scotland at 3.4%. Prices fell by 2.2% in London, 2.1% in the south-east of England and 1.4% in the south-west.

The figures come as higher mortgage costs put pressure on buyers. On Monday, the average five-year fixed homeowner mortgage rate reached 6% for the first time in three years, according to Moneyfacts.

Andrew Asaam, mortgages director at Lloyds, said: “While the market overall has been fairly subdued, property prices have so far proved resilient during a period of higher mortgage rates, which has been driven by changing expectations around the future path of base rate.”

He said household spending had held up better than many expected despite energy costs and other pressures arising from the Middle East conflict.

“Confidence has long been a key driver of housing market activity, and will play an important role in shaping demand over the remainder of this year and into 2027,” he added.

Ian Futcher, a financial planner at wealth manager Quilter, warned that affordability, confidence and borrowing costs were all coming under pressure.

“The market is facing gathering dark clouds on several fronts,” he said.

“The forthcoming Budget is adding another layer of uncertainty, with some buyers choosing to sit on their hands until there is greater clarity on the Government’s tax and housing policy agenda.”

Mr Futcher said concerns that the conflict involving Iran could keep energy prices and inflation higher for longer were affecting expectations for interest rates.

Mortgage rates

Tom Bill, head of UK residential research at Knight Frank, said: “We think downward price pressure will continue during the final months of the year as the impact of higher mortgage rates feeds slowly through to buyers.”

Andrew Montlake, chief executive of Coreco mortgage brokers, said affordability would remain the main issue for the rest of the year.

“If mortgage costs stay elevated, sellers may need to be realistic on price, while buyers need to focus less on chasing the market and more on what genuinely works for their monthly budget,” he said.

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