UK House Prices Fall 1.2% as London Leads Regional Declines

UK house prices recorded their sharpest annual fall in three years in October. According to the Lloyds House Price Index (formerly the Halifax index), prices fell 0.6% in the month to an average of £296,285, and were 1.2% lower than a year earlier, the biggest annual fall since October 2023. The weakness has been building, as average prices have now fallen on a quarterly basis for six months in a row.

The national figure hides a sharp regional split. Greater London recorded the largest annual decline, down 3.1% to £524,892, followed by the South East and South West, both down 2.4%. By contrast, Northern Ireland led annual growth at 4.4%. Affordability explains much of the gap: prices in the three northern English regions remain below six times average earnings, compared with roughly 11.3 times in London.

Falling values, especially across southern England, increase the risk of down-valuations, tighten LTV headroom and put pressure on GDV assumptions for schemes completing over the next 12 to 18 months. Loans that rely on a sale exit in London and the South may take longer to repay, so realistic sales timelines and extension terms matter. Meanwhile, stronger markets in Scotland, Northern Ireland and parts of the North offer firmer valuation support. Using local, up-to-date comparables rather than national averages is becoming more important as regional markets diverge.