UK home costs hit file excessive in February as charge minimize hopes fade

The common UK home worth reached £301,151 in February, a brand new file excessive, Halifax reviews.

For sale signs outside a house

UK home costs hit file excessive in February as charge minimize hopes fade (Picture: Getty)

The common home worth within the UK hit a brand new file of £301,151 in February, in response to an index. Halifax reported that property values sometimes rose by 0.3% month on month, following a 0.8% improve in January.

In February, the common home worth rose by 1.3% yr on yr. Amanda Bryden, head of mortgages at Halifax, said: “Because the begin of the yr, common costs have elevated by round £3,000, with a typical property now costing £301,151. These newest figures recommend the market has regained some momentum after a softer finish to 2025.”

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The common UK home worth reached £301,151 in February, a brand new file excessive, Halifax reviews. (Picture: Getty)

She added: “Trying forward, geopolitical uncertainties appear set to affect the outlook for inflation and the broader financial system. Towards that backdrop, markets at the moment are anticipating a extra gradual path for rate of interest reductions. If realised, the pace at which borrowing prices ease could also be tempered.”

This week, a number of main mortgage lenders, together with HSBC UK and Nationwide Constructing Society, introduced will increase to mortgage charges, with some charges rising on Friday.

These adjustments comply with will increase in swap charges, which lenders use to cost mortgages, amid heightened market expectations of upper inflationary pressures stemming from the battle within the Center East.

Mark Harris, chief government of mortgage dealer SPF Personal Purchasers, mentioned: “Swap charges, which underpin the pricing of fixed-rate mortgages, have edged larger amid fears that rising costs will gas inflation.

“Expectations of a near-term base charge minimize, maybe as early as this month, have considerably decreased.

“Numerous lenders have already elevated their mortgage charges to replicate larger swaps and others are more likely to comply with swimsuit to be able to preserve in line and defend service ranges.”

Karen Noye, a mortgage professional at wealth supervisor Quilter, mentioned: “While the market has loved early momentum, geopolitical occasions could throw this into query.

“The backdrop for patrons has change into extra sophisticated in just some days. Hopes of a steadier charge atmosphere have been disrupted by recent instability following the battle in Iran.”

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Alice Haine, a private finance analyst at Bestinvest by Evelyn Companions, mentioned: “Now the housing market has a recent problem: battle within the Center East that has despatched vitality costs hovering, creating an inflationary headwind which can cloud the outlook for rates of interest, simply at some extent when borrowing prices had eased into extra palatable territory.

“The Financial institution of England had been anticipated to chop rates of interest at its subsequent Financial Coverage Assembly on March 19, supported by easing inflation, issues over rising unemployment and sluggish financial progress – with the potential for additional cuts later within the yr.

“Nevertheless, fears at the moment are mounting that charge cuts could also be delayed, or worse, that the Financial institution could even want to lift charges once more to counter a recent inflationary shock pushed by surging vitality costs.”

Tom Invoice, head of UK residential analysis at Knight Frank, added: “Momentum within the housing market had been rebuilding after November’s Finances and the outlook for mortgages was brighter solely every week in the past.

“Nevertheless, a chronic battle within the Center East would dampen sentiment and delay charge cuts on account of rising inflation, which might put downwards strain on costs.

“That mentioned, we now have seen how shortly rate of interest expectations can change this yr, and the underlying weak point within the jobs market is considered one of a number of causes that a number of cuts might come again onto the desk in 2026, which might assist demand. Rather a lot hinges on the size of the battle.”

Tony Gambrill, regional gross sales director at Chestertons, commented: “In February, the property market was pushed by first-time patrons in addition to households eager to upsize which boosted demand for new-build houses and bigger homes.

“Regardless of some lenders elevating mortgage charges once more, home hunters stay undeterred, which suggests a very busy and aggressive spring market forward.”

Mary-Lou Press, president of NAEA (Nationwide Affiliation of Property Brokers) Propertymark, mentioned: “The newest Halifax Home Value Index confirms that common property values have remained above the £300,000 mark for the second consecutive month, reinforcing the resilience of the UK housing market.

“Sustained pricing at this stage indicators continued purchaser confidence, regardless of affordability pressures and wider financial uncertainty.”

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Listed here are common home costs and the annual change, in response to Halifax (the regional annual change figures are primarily based on the newest three months of authorized mortgage transaction knowledge):