The average UK house price fell by 0.4% in October, to follow the 0.1% drop in September, the latest Halifax House Price Index has revealed.

This is the third decrease in four months and the sharpest monthly drop recorded by Halifax since February 2021.

Halifax also reported that the annual rate of house price growth slowed to 8.3%, from 9.8% in September, to take the average UK house price to £292,598, down from £293,664 last month.

The rate of growth slowed in all but one region in England during October, with the North East of the country the only exception. Similar slowing trends were reported in Northern Ireland, Scotland, and Wales.

“Though the recent period of rapid house price inflation may now be at an end, it’s important to keep this is context, with average property prices rising more than £22,000 in the past 12 months, and by almost £60,000 (+25.7%) over the last three years, which is significant,” said director at Halifax Mortgages, Kim Kinnaird.

“While a post-pandemic slowdown was expected, there’s no doubt the housing market received a significant shock as a result of the mini-Budget which saw a sudden acceleration in mortgage rate increases. While it is likely that those rates have peaked for now – following the reversal of previously announced fiscal measures – it appears that recent events have encouraged those with existing mortgages to look at their options, and some would-be homebuyers to take a pause.

“Understandably we have also seen consumer caution grow, as industry data shows mortgage approvals and demand for borrowing declining. The rising cost of living coupled with already stretched mortgage affordability is expected to continue to weigh on activity levels. With tax rises and spending cuts expected in the Autumn Statement, economic headwinds point to a much slower period for house prices.”

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