The average UK property price has surpassed £300,000 for the first time, according to data from Halifax.

The bank’s January house price index revealed that house prices increased by 0.7% month-on-month, after falling by 0.5% in December, to reach £300,077.

On an annual basis, house prices increased by 1%, after rising by 0.4% in the previous month.

Halifax said that property prices reaching this figure was a result of "relatively modest" growth in recent years, following the sharp increases seen during the pandemic.

In the three years from 2020 to 2023, prices increased by 19% due to low borrowing costs and the race for space, Halifax said. By comparison, between 2023 and 2026, property prices jumped by 5.7% as higher interest rates and stretched affordability have kept growth muted.

Head of mortgages at Halifax, Amanda Bryden, stated that while its a milestone figure, affordability remains a challenge for would-be buyers.

She added: "Broader economic conditions continue to provide some support. Wage growth has been outpacing property price inflation since late 2022, steadily improving underlying affordability. That’s a positive trend for buyers, and the long-term health of the market.

"We’re now seeing more mortgage deals below 4%. If inflation continues to ease, there should be further gradual reductions as the year goes on. All in all, we still think house prices are likely to edge up between 1% and 3% this year."

Halifax stated that regional differences in house price performance have become more pronounced, with a clear divide between the North and the South.

Northern Ireland continues to lead the increase in house prices, with the average property price jumping by 5.9% to £217,206, while Scotland (£217,206) and Wales (£228,415) saw increases of 5.4% and 0.5% respectively.

In England, the strong growth remained concentrated in the North, with prices in the North West (£244,328) increasing by 2.1% and the average property price in the North East (£181,198) rising by 1.2% year-on-year.

This compares to the Southern regions, comprising the South East, South West, London and Eastern England, which all saw annual declines of more than 1%.

Bryden concluded: "For first-time buyers the headline numbers can seem daunting, but it’s important to remember that most are looking at smaller properties in areas that reflect their budget. Many locations offer far more accessible price points, especially in northern regions where homes can often be found for under £200,000.

"Affordability is still a challenge, but stronger wage growth and falling mortgage rates have helped relieve some of the pressure in recent years. We expect that improvement to continue in 2026, meaning that with the right support and advice, home ownership should become a realistic prospect for more would-be buyers."

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