UK house price growth slowed sharply in June, with the average annual rise dropping to 2.0% from 3.0% the previous month, according to figures from the Office for National Statistics (ONS). The average UK home now costs £272,000, up £5,000 on a year earlier, but the pace of growth has cooled noticeably since the spring.
The ONS publishes a monthly house price index based on completed mortgage transactions across the UK. It is one of the most widely watched measures of property values because it covers all buyers, not just those using a particular lender.
Why UK House Price Growth Slowed This Summer
ONS head of housing market indices Aimee North put the slowdown in plain terms: ‘Annual UK house price inflation slowed significantly in June because price growth was weaker this summer than it was last year following stamp duty changes in England and Northern Ireland.’
Those changes are worth unpacking. According to City AM, the zero-rate threshold for stamp duty, the tax paid when buying property in England and Northern Ireland, dropped from £250,000 to £125,000. Buyers purchasing homes between £250,000 and £925,000 now face a 5% levy on the portion above £125,000. That shift removed a significant incentive that had driven buyers to complete purchases before the deadline, inflating prices in early 2025.
The ONS figures confirm this pattern. Strong price growth was recorded in May and June 2025 as average prices rebounded sharply after a fall in April 2025. Comparing summer 2026 with that elevated baseline makes the current figures look weaker by comparison, even though the market has not collapsed.
Regional Breakdown: Northern Ireland Leads, London Falls Again
The national average masks wide regional variation. In England, the average price reached £293,000 in June, representing 1.8% annual growth. Wales recorded an average of £213,000 (also 1.8% growth), and Scotland came in at £195,000, up 2.3% on a year earlier.
Northern Ireland told a very different story. The average price there reached £202,000 in the second quarter of 2026, with annual growth of 9.2%, the highest rate of annual inflation in Northern Ireland since the fourth quarter of 2022.
Within England, the North West posted the strongest growth at 4.7% in the 12 months to June. London remains the weakest region, with annual prices still falling, down 2.5% on the year. The rate of decline has eased from 3.1% in the 12 months to May, but June marked the 10th consecutive month of annual price falls in the capital, driven mainly by decreases in inner London.
Rents Rising, Though Growth Is Easing
The ONS also published private rental data alongside the house price figures. The average monthly private rent across the UK stood at £1,393 in July, around £50 (3.7%) higher than a year earlier. City AM reported that monthly private rents rose by 5.9% over the 12 months to July, slightly below the 6.7% growth recorded for June, suggesting rental inflation is also beginning to moderate.
Richard Donnell, executive director of research at Zoopla, said people ‘are renting for longer, which will support demand for rented homes and steady growth in rents, particularly as we come into the busy time of year for the rental market as students and those starting new jobs compete for a still scarce supply of rented homes.’ He added that rents are rising slowly in many big university cities but faster in affordable towns adjacent to big cities.
Jeremy Leaf, a north London estate agent, noted that rental demand ‘remains strong, particularly for higher-end houses among those returning from holiday seeking accommodation before the new school term.’
Mortgage Rates and What Comes Next
The house price figures arrived on the same day the ONS reported that Consumer Prices Index (CPI) inflation (which measures the rate at which everyday prices rise) accelerated to 2.9% in July, up from a 15-month low of 2.6% in June.
David Hollingworth, associate director at L&C Mortgages, said the inflation increase was ‘largely in line with market expectations,’ adding that ‘financial markets are already factoring in the threat of interest rates having to climb to combat higher inflation.’ He cautioned that ‘there remains a volatile backdrop and it’s impossible to rule out more yo-yoing in mortgage rates at this stage.’
Ian Futcher, a financial planner at wealth manager Quilter, agreed that mortgage rates will remain the market’s key driver: ‘If lender competition continues and borrowing costs can gradually ease, activity should remain supported, but a swing the other way could see the market stall once again.’
Iain McKenzie, chief executive of the Guild of Property Professionals, said he expects activity to pick up in autumn ‘as the usual seasonal bounce returns, provided mortgage rates continue to ease and economic uncertainty does not intensify,’ with price growth likely to stay modest for the rest of the year. Nathan Emerson, chief executive at property professionals’ body Propertymark, added that short-term fluctuations ‘can influence confidence and lead some homeowners to delay decisions until there is greater certainty about the direction of the market.’
