Annual UK house price growth halves as mortgage rates rise – business live

Billy Odell Tucker-Robinson Founder & Host — Banking With Billy Network • Financial Intelligence • Markets • World News • Independent Analysis
Published: 2026-10-01 • Permanent link

Hesitation grips UK housing market as mortgage rates soar.

Nationwide's latest data reveals a stark slowdown in the UK's housing market, with annual house price growth halving to 4.2% in September, down from 8.5% in the same period last year. The news sent shockwaves through the market, with the FTSE 100 experiencing a 1.3% decline in early trading. Analysts at UBS believe the slowdown is largely driven by the sharp rise in mortgage rates, which have increased by 0.5% in the past month, making it more expensive for buyers to secure a loan.

This news has significant implications for investors, with many expecting a further decline in housing prices in the coming months. The slowdown in house price growth also raises concerns about the impact on the broader economy, particularly in regions where housing is a significant contributor to local economies. With the UK's housing market already facing challenges from Brexit and the pandemic, this latest development has left many wondering if the market has finally reached its peak.

Experts point to the UK's unique housing market dynamics as a key factor in the slowdown. The country's housing market has long been characterized by a mismatch between supply and demand, with many areas experiencing severe shortages of available homes. This has driven up prices and led to a surge in house prices in recent years. However, the recent slowdown in house price growth may mark a turning point in this trend, with some experts predicting a return to more stable growth rates in the coming years.

Looking ahead, investors will be watching closely for further developments in the housing market, including the impact of the government's latest housing policy announcements. The Bank of England's decision to raise interest rates in recent months has already had a significant impact on the housing market, and many expect further rate hikes to be on the cards. With the UK's housing market facing significant challenges, investors will be keeping a close eye on the latest developments to gauge the potential impact on their portfolios.