Is now a good time to buy a house? Home prices have fallen, but there are many factors to consider before jumping on the property ladder. The decision largely depends on your personal finances rather than market timing, yet the economic environment also plays a role.
Average Property Values
According to the Halifax House Price Index, house prices fell 0.1% in May, following a similar decline in April. The average property price now stands at £298,806, compared to £299,251 in April. Annual growth has edged up slightly to 0.5%, from 0.4% in April. In England, stronger price growth remains concentrated in northern regions. The North East saw prices rise 3.1% over the year to £181,703, while the North West recorded annual growth of 3.0%, with the average home now costing £248,304. By contrast, southern markets continue to see declines. The South East led with prices down 2.1% year-on-year to £382,704, while London saw average values fall by 1.5% to £534,375.
Expert Insights
Amanda Bryden, Head of Mortgages at Halifax, said: “Property price trends continue to reflect the uncertainty linked to developments in the Middle East. Despite recent cuts to mortgage rates, higher inflation expectations have kept borrowing costs above the level seen at the start of the year, continuing to stretch affordability for many buyers and temper demand. Even so, overall activity has held up well, reflecting the underlying resilience of the UK housing market. Looking ahead, borrowing costs and consumer confidence are likely to continue shaping activity in the coming months, with house prices expected to remain broadly stable while interest rates stay elevated.”
Down Valuations on the Rise
Joseph Lane, mortgage broker and founder of Mortgage Lane, explains that lenders are being more cautious and scrutinising property values more carefully. He said: “As a mortgage broker, I am certainly seeing more down valuations than in the past few years. Lenders are being much more cautious in a higher interest rate era that is far removed from the low-rate conditions many borrowers had become accustomed to. The harshness of the 2026 market is not temporary, but a full structural reset that’s influencing how the UK borrows, purchases property, and their approach to affordability.”
Mortgage Rates Outlook
The base rate rose sharply from late 2021 to a peak of 5.25% in 2023 as the Bank of England tried to control inflation. It has since been cut to 3.75%, where it has been held since December 2025, with the next rate decision due on 18 June 2026. However, the conflict in the Middle East has pushed up oil and gas prices, adding pressure to inflation expectations and causing financial markets to reassess how quickly rates might fall further. According to UK Finance, around 1.8 million fixed-rate mortgages are due to end in 2026. Many homeowners locked in when typical fixed rates were closer to 2.5% and will now remortgage into a market where the lowest available five-year fixed rates sit around 4.48% in June 2026, according to HomeOwners Alliance data. The average standard variable rate currently averages around 7.27% according to Moneyfacts. Bank of England modelling suggests monthly repayments are projected to increase by around £64 a month on average for those remortgaging onto higher rates.
Reasons It Might Be a Good Time to Buy
If you have a stable income, a good credit score, manageable debt, and enough savings for a deposit and emergency fund, buying a home can make sense. Homeownership allows you to build equity instead of paying rent, and if you plan to stay in the property for at least five years, you are more likely to ride out short-term market fluctuations. In some areas, house prices have stabilised after periods of rapid growth, giving buyers more negotiating power than they had during highly competitive markets.
Reasons You Might Want to Wait
If your credit score needs improvement, your job situation is uncertain, or you have little savings beyond the deposit, waiting may be the better option. Higher mortgage rates can significantly increase monthly payments, so buying before you are financially prepared can put unnecessary strain on your budget. You may also want to delay if you expect to move within the next few years, as buying and selling costs can outweigh the benefits of homeownership over a short period. Boosting your credit score is an invaluable way to ensure the home buying process is as easy as possible.
