The average UK house price hit a new record high of £298,083 in November, according to an index.
Property values rose by 1.3% month-on-month, marking the fifth increase in a row, Halifax said.
On an annual basis, house prices increased by 4.8% in November, accelerating from 4.0% growth in October.
Amanda Bryden, head of mortgages at Halifax, said: “UK house prices rose for the fifth month in a row in November, up by 1.3% in the month – the biggest increase so far this year. This pushed the annual growth rate up to 4.8%, its strongest level since November 2022.
“As a result, the record average house price we saw in October edged higher still, with a typical property now costing £298,083.
“Latest figures continue to show improving levels of demand for mortgages, as an easing in mortgage rates boost buyer confidence. However, despite these positive trends, many potential buyers and movers still face significant affordability challenges and buyer confidence may be tested against achangeable economic backdrop.
“As we move towards the end of the year and into 2025, positive employment figures and anticipated decreases in interest rates are expected to continue supporting demand.
“This should underpin further house price growth, albeit at a modest pace as borrowing costs remain above the average of a few years ago.”
Northern Ireland continues to record the strongest property price growth, with values rising by 6.8% annually, Halifax said.
House prices in the North West recorded the strongest growth of any region in England, with values up by 5.9%.
Scotland saw a more modest rise in house prices compared with elsewhere in the UK, with a 2.8% annual increase.
Nathan Emerson, chief executive of property professionals’ body Propertymark, said: “With interest rates now easing, many buyers will have increased confidence to approach the housing market.
“We are, however, likely to see a spike in homes for sale and those looking to move home, especially across England and Northern Ireland trying to complete before the rises to stamp duty commence from April 2025.”
Temporary stamp duty thresholds are set to end from April, with the “nil rate” band for first-time buyers in Northern Ireland decreasing from £425,000 to £300,000.
This sense of temporary strength is reinforced by the fact many buyers are acting ahead of a stamp duty increase next April
Tom Bill, head of UK residential research at Knight Frank, said: “An increase in borrowing costs and the disappearance of sub-4% mortgages in recent weeks means we expect downwards pressure on house prices to intensify next year.
“This sense of temporary strength is reinforced by the fact many buyers are acting ahead of a stamp duty increase next April. The risk that inflation and mortgage rates stay higher for longer means we recently revised down our UK house price forecasts for the next three years. Growth will feel more sustainable once the economy is heading decisively in the right direction.”
Alice Haine, personal finance analyst at Bestinvest by Evelyn Partners, said: “The Prime Minister has doubled down on his pledge to boost living standards during his parliament and build 1.5 million new homes – measures that have the potential to improve people’s chances of being able to afford a home.
“But the combined effects of the cost-of-living crisis and the higher tax burden of recent years have already dealt a heavy blow to how much money people have left in their pockets after they have paid tax and accounted for inflation. And house building targets take some time to materialise.”
Karen Noye, a mortgage expert at wealth manager Quilter, said: “Recent data from the Bank of England has already pointed to rising mortgage approvals, which reached their highest level since mid-2022.
“Combined with a reduction in quoted mortgage rates, this suggests that buyers are returning to the market, encouraged by the more favourable lending conditions.
“However, affordability remains a critical issue, particularly for first-time buyers who are still grappling with high borrowing costs and larger deposit requirements, factors that have constrained demand over the past year.”
Nigel Bishop of buying agency Recoco Property Search, said: “There has been a general uplift in buyer demand in November which impacted on property values and enabled some sellers to achieve their asking price.”
Jeremy Leaf, a north London estate agent, said: “Demand continues to be strong, particularly for competitively-priced homes in lower-value areas.
“However, investors hit by higher buying costs are proving unwilling or unable to take on typically smaller one- and two-bedroom homes. On the other hand, confirmation that the stamp duty concession will not be extended has given an opportunity to first-time buyers, especially of such properties, to take advantage.
“That has also given a lift to the rest of the market by releasing second-steppers and connecting chains. However, buyers are taking their time before committing as affordability concerns remain.”
Jonathan Hopper, chief executive of Garrington Property Finders, said: “The supply of good quality prime homes for sale is strong, and buyers at this end of the market often find themselves spoilt for choice and able to negotiate hard on the price they pay – and this is keeping prime price rises much more modest.”
Here are average house prices in November and the annual increase, according to Halifax. The regional annual change figures are based on the most recent three months of approved mortgage transaction data:
East Midlands, £242,282, 3.5%
Eastern England, £335,063, 3.6%
London, £545,439, 3.5%
North East, £175,737, 4.4%
North West, £237,045, 5.9%
Northern Ireland, £203,131, 6.8%
Scotland, £208,957, 2.8%
South East, £388,534, 3.4%
South West, £304,558, 3.7%
Wales, £225,084, 4.1%
West Midlands, £257,982, 5.5%
Yorkshire and the Humber, £212,385, 4.7%
