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Which UK regions are showing the strongest performance in terms of house price growth? What does this mean for landlords reviewing their current property portfolios?

Annual house price growth for 2023 was -2.0%, primarily due to rising mortgage interest rates slowing buyer appetite and the ongoing cost-of-living crisis delaying typical purchase activity. Industry experts are confident that we will see a similar market for 2024, with many expecting growth between -2% and 0%.

However, Halifax's latest House Price Index reveals that average house prices rose by 1.1% in December, making this the third consecutive rise. Which regions show positive signs of house price growth, and conversely, where are prices continuing to fall?


Top performing regions for house price growth

According to Halifax’s report, Scotland saw significant house price growth, with the average property price now £205,170, a 2.6% increase or £5,277 in cash terms year-on-year. Other regions showing strong house price performance include the North-West, and Yorkshire and the Humber, with 0.3% and 0.1% growth, respectively.

  1. Scotland
  2. North-West
  3. Yorkshire and the Humber

On a more local level, several areas across the UK show particularly strong house price performance. Powys in Wales takes the top spot, with an annual house price growth of 17.4%. East Lindsey in Lincolnshire follows closely behind, with a growth of 13.3%, making it the strongest-performing area in England for property price inflation over the last year. Moray in Scotland makes the top three, with an impressive house price growth of 10.7%.

  1. Powys, Wales
  2. East Lindsey, Lincolnshire
  3. Moray, Scotland


Which regions continue to see house prices fall?

Perhaps unsurprisingly, the Southeast and London continue to see the worst annual house price growth performance. Prices in the Southeast fell the most throughout 2023 despite the average sale price significantly higher than that of Scotland, at £376,804. This is an annual change of -4.5%, or a drop of £17,555.

Similarly, despite London retaining the top spot for the highest average house price across all UK regions at a staggering £528,798, the capital saw prices drop by 2.3% annually.


What does this mean for landlords?

If you’re considering your next property investment purchase, the top areas to consider are regions where house prices show positive signs of growth. Properties in these regions offer opportunities for higher returns on investment in the long term. Therefore, with house prices unlikely to peak much higher this year, landlords now have an excellent opportunity to secure a competitive purchase price on these properties.

Kim Kinnaird, Director at Halifax Mortgages, notes: “There are multiple factors which can impact house prices in your local area, ranging from the mix of properties available and the extent of any new housing to the quality of schools and abundance of job opportunities.

“What’s clear is that the UK housing market is not a single entity that performs in a uniform way across the country, there are differences.

"While at a national level, the current squeeze on mortgage affordability has seen property prices fall over the last year, in many regions, there remain pockets of house price growth. While a limited supply of properties for sale could be a factor, this also suggests in some areas, local market activity – and demand among buyers – remains strong.”

If you’re considering your next property investment purchase, or if you’d like to discuss your property finance plans with one of our expert brokers, submit an enquiry here or call us on 0345 345 6788.

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