UK annual house price growth held broadly steady in August at 1.6%, up marginally from 1.4% in July, according to Nationwide’s latest house price index.
Prices rose 0.2% month on month after seasonal adjustment, leaving the average UK house price at £275,465.
“UK annual house price growth was little changed in August at 1.6%, compared with 1.4% in July,” said Robert Gardner, Nationwide’s chief economist. “Prices were up 0.2% in month-on-month terms, after taking account of seasonal factors.
“Market activity and house prices have remained subdued in recent months, in part reflecting the uncertain economic backdrop. Geopolitical tensions remain high, with the conflict in the Middle East exerting upward pressure on energy prices and market interest rates.
“Market expectations of the future path of Bank Rate have been volatile. While the latest energy price shock poses inflation risks, there have been encouraging signs that it is not feeding through to underlying price pressures. Indeed, private sector wage growth has eased further in recent months, which should give policymakers breathing space to assess the extent to which tighter policy is necessary to ensure inflation returns sustainably to target.
“Underlying affordability is improving, as house price growth remains well below earnings growth, although some of these gains have been offset by higher mortgage rates. Nevertheless, this suggests that activity should regain momentum in the quarters ahead providing the energy shock wanes and confidence returns, especially if market interest rates fall back towards pre-conflict levels.”
Alongside the monthly figures, Nationwide published research examining the price premium associated with National Park locations. Its analysis found that a home within a National Park attracts a 24% premium over a comparable property elsewhere, equivalent to roughly £66,500 based on the UK average house price of £278,784 in Q2 2026. Properties within 5km of a National Park boundary also benefit, commanding a 6% premium over those beyond that range.
The research extended to National Landscape areas in England and Wales, formerly known as Areas of Outstanding Natural Beauty, which include the Surrey Hills, Cotswolds and Chilterns. Properties in these designations carry a 14% price premium over otherwise identical homes, a figure Nationwide attributed to the continued appeal of rural living and associated lifestyle factors, alongside restricted housing supply.
Gardner noted that development controls within National Parks limit new housing construction, which may contribute to the premium alongside the areas’ natural and recreational appeal.
Industry reaction
Nathan Emerson, chief executive at Propertymark, pointed to the broader economic context. “Considering factors such as ongoing global unrest, it is positive to see the housing market deliver stability and overall consistency,” he said.
“The wider economy continues to be finely balanced, with many factors continuing to prove an unwelcome undercurrent for consumer affordability. Across the year to date, there have been many challenges to navigate, with average energy prices climbing, inflation still higher than targeted and the base rate remaining higher than many might prefer.
“A key moment for many households will come with the next base rate decision due mid-month, closely followed by what might be included in the forthcoming Autumn Budget at the end of October.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, said the flat monthly reading reflected buyers’ caution rather than a lack of activity. “Flat monthly house prices indicate that those focused enough to buy over the summer months were not willing or perhaps able to pay over-the-odds but took advantage of the buyers’ market and negotiated accordingly,” he said.
“Lenders mostly continue to trim their mortgage rates, while the Bank of England’s steady approach to base rate is conveying calm after a period of Swap rate volatility.
“Borrowers are taking nothing for granted though as the continued high cost of living strains affordability. Many are taking the sensible approach of locking into mortgage rates several months before they need them for peace of mind.”
