House prices rebound to record high in January - Halifax

6th Feb 2026 07:45

(Sharecast News) - House prices rebounded in January to a record high, according to figures released on Friday by Halifax.

House prices rose 0.7% on the month following a 0.5% decline in December. On the year, prices were up 1% in January following a 0.4% increase the month before.

The average price of a home stood at £300,077, up from £297,938 in December and above £300,000 for the first time.

Amanda Bryden, head of mortgages at Halifax, said: "While that's undoubtedly a milestone figure, and activity levels show a resilient market, affordability remains a challenge for many would-be buyers.

"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.

"And 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."

Matt Swannell, chief economic advisor to the EY Item Club, said that on the face of it, house prices made a strong start to the year but below the surface the story is more nuanced. He pointed out that most of the 0.7% jump in January was "just the reversal" of December's decline.

"Over the last three months, house prices have only increased by 0.1%. Looking past the month-to-month noise, house price growth has been quite modest over the last year, increasing by 1% across the 12 months to January. Activity in the market has remained resilient over the last year, but affordability challenges remain, with the Halifax's average house price estimate ticking over £300k for the first time," he said.

"Last year's housing market was shaped by April's change in Stamp Duty thresholds. However, housing market performance in 2026 will likely reflect wider economic conditions, with the property taxes announced at the Autumn Budget likely to have little impact. The high value council tax surcharge will only impact less than 1% of properties in England and, in any case, it will only come into effect in April 2028."

Swannell said house prices will likely rise at a subdued pace over the next twelve months.

"With pay growth slowing, the big improvements in housing affordability seen over the past couple of years look to be a thing of the past, and valuations are still stretched. Meanwhile, mortgage rates look unlikely to fall a lot further, with the Monetary Policy Committee (MPC) reinforcing its view that it is approaching the end of its rate cutting cycle."