Halifax: House prices fell in September as rumoured tax hikes hang over the market

House prices fell in September, data suggests, reversing an August rise, as property price growth remained stop-start amid a shaky outlook.

The average price of a house in the UK fell by 0.3% last month to £298,184, £794 lower than it was in August, according to new data from Halifax.

This dip has brought the average annual growth rate down from 2% in August to 1.3% in September, the slowest rate since April 2024. Quarterly house price change is up 0.4%.

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Amanda Bryden, head of mortgages at Halifax said: “This slight monthly dip in house prices reflects a housing market that has remained broadly stable, prices are up +0.3% since the start of the year.

“It’s also important to remember that prices vary widely depending on characteristics like location and property type. As a result, many homes are available at a cost well below this headline figure.”

Challenges have hit the housing market over the past year. A hike in stamp duty led to a rush of transactions ahead of the April deadline before activity dipped.

Though the market started to bounce back in recent months, some buyers have been spooked by recent rumours that property taxes could be hiked in the Autumn Budget, due to be delivered on 26 November.

Chancellor Rachel Reeves may be considering replacing stamp duty with a new tax on the sale of homes worth over £500,000, The Guardian reported in August.

Reports also suggest the Treasury could be looking at extending capital gains tax to the sale of more expensive homes. The tax is currently charged on the sale of second homes, but changes could bring some first homes into the tax net.

The Treasury has not confirmed any details about what could be announced in the Budget.

Alice Haine, personal finance analyst at Bestinvest by Evelyn Partners, said: “The lacklustre data suggests the market has not only failed to shrug off the effects of April’s increase in stamp duty land tax, but that speculation around possible reforms [...] is creating a fresh cloud of uncertainty.

“The speculation is having a dampening effect on market activity, particularly at the top end of the market. Buyer demand for homes priced over £1 million has fallen by 11%, and by 4% for properties over £500,000 according to Zoopla, as many prospective purchasers adopt a ‘wait and see’ approach.”

This sentiment is echoed by Karen Noye, mortgage expert at Quilter, who said: “With borrowing costs still high, weaker household finances and potential tax changes on the horizon, house prices are likely to remain broadly stable in the near term, with regional trends reflecting local supply and demand rather than a clear national direction.”

Halifax’s figures contrast with those released by Nationwide last week, which reported house prices as rising by 0.5% in September after a 0.1% dip in August.

Where in the UK is house price growth strongest?

Northern Ireland once again leads the pack as the UK region with the strongest house price growth, seeing property prices increase by 6.5% in the past year. The average house in the region now costs £216,496, according to Halifax.

The region with the second-strongest house price growth was the North East with an annual change of 4.8% as average prices climbed to £180,443.

House price growth has broadly remained strong in the entirety of the north of England and Scotland, but the south and Midlands have comparatively struggled to keep pace.

The region with the worst annual house price change is the South West, the only place in the UK where the average house is cheaper today than a year ago as prices have fallen by 0.2% to £303,067.

The South East has not fared much better. Though prices are higher than they were a year ago, this is only marginally so as the region reported just a 0.2% annual increase.

London remains the region with the highest average house price of £543,497, over £150,000 more than in the second-most expensive region. Property prices in the region have remained broadly unchanged, however, growing by just 0.6% in the past year.

Source: Halifax, October 2025