The rate of annual house price growth jumped by 0.2% in September, new figures published by the Office for National Statistics (ONS) have shown.

According to the latest ONS House Price Index, the average UK house price increased by 2.9% in the year to September, up from 2.7% growth in the 12 months to August.

The latest figures took the average UK house price to £292,000 in September, as the ONS noted that annual house price inflation continued its increase since a low point of -2.7% growth recorded in the 12 months to December 2023.

In the year to September, average house prices climbed by 2.5% in England to £309,000, 0.4% in Wales to £217,000, and 5.7% in Scotland to £198,000.

April Mortgages director, Rachael Hunnisett, highlighted that the market had records its seventh consecutive month of growth but warned that “the tide appears to be turning”.

“Mortgage rates are creeping up again, and inflation has now climbed back above the Bank of England’s 2% target, casting doubt over the strength of the housing market’s recovery,” Hunnisett commented.

“Although mortgage approvals recently rose to their highest level in two years, there is a risk that borrowers start to pull back as the market looks more uncertain. If interest rates are slow to fall in the coming months, we may see house price rises soften as homebuyers become more cautious and demand falls.”

Managing director at RAW Capital Partners, Ben Nichols, noted that the ONS House Price Index “lags two months behind”, and added: “It is important to acknowledge that today’s data doesn’t reflect some of the short-term uncertainty that the Autumn Budget introduced to the market.

“Prices may have slowed month on month, but the annual price increase, coupled with higher levels of market activity in recent weeks, demonstrates the continued recovery that the market has been experiencing since the Bank of England began its rate-cutting cycle.

“Of course, the Bank has cut rates again since the period this data covers, suggesting this positive trend should continue to the end of the year.”

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