Editor's note: This brief was summarised by The Property AI Newsroom from a report by Property Industry Eye. Read the original article for full details.

UK House Prices See First Annual Decline Since 2023, Lloyds Data Shows

UK house prices have recorded their first annual fall since November 2023, according to the latest Lloyds House Price Index. The average property price in August 2026 was £298,468, down 0.4% year-on-year and 0.2% from the previous month.

The data shows that subdued market conditions continue to affect property values, with affordability pressures and borrowing costs influencing buyer activity. The average UK home value dropped from £299,153 in July to £298,468 in August, following a 0.1% decline in July and a further 0.2% fall in August.

Regional Variations Remain Significant

The national figures mask notable regional differences. Northern Ireland recorded the strongest annual house price growth, with values rising by 6.9% to a record average of £231,245. Scotland also saw growth, with prices up 3.5% year-on-year to £223,437. In Wales, annual growth stood at 0.6%, with the average property valued at £230,282.

Within England, northern regions outperformed the south. The North East saw prices increase by 2.7% year-on-year to £184,370, while the North West recorded 2% growth to £248,675. In contrast, southern England experienced declines: the South East saw the largest annual fall at 1.6% (average price £381,729), followed by Greater London with a 1.5% drop to £534,177. The South West and Eastern England both recorded annual falls of 1.2%.

Market Activity and Outlook

The report notes that fewer homes are changing hands, with industry figures at their lowest level since the start of 2024. Despite recent declines, average house prices remain around 25% higher than at the end of 2019. The market’s adjustment to higher borrowing costs has been gradual, with wage growth helping to offset some affordability pressures.

For letting agents and inventory clerks, these trends highlight ongoing regional disparities and the impact of affordability on market activity. The subdued market conditions and slower transaction volumes may influence rental demand and property turnover in the coming months.