UK house prices rose 0.5% in September, leaving average values at £271,995, according to Nationwide’s latest index. Annual growth edged to 2.2%, largely steady on August, but with striking regional contrasts. For landlords, the figures underline stronger rental yield prospects in northern markets compared with slower-moving southern England.
Northern regions show landlord-friendly growth
Northern Ireland topped the charts with a 9.6% annual rise, while the North of England recorded growth of 5.1%. In contrast, the Outer South East managed just 0.3%, the weakest in the UK. Robert Gardner, Nationwide’s chief economist, said: “The broad stability in the annual rate of house price growth over the past three months mirrors that of activity… mortgage approvals have hovered at around 65,000 per month, close to pre-pandemic averages.”
For investors, the message is clear: yields remain stronger where capital values are rising modestly but rental demand is tight. Landlords in London and the commuter belt may face softer capital appreciation, yet the North, Wales and Scotland continue to deliver better blended returns.
Property types diverge with flats lagging
Semi-detached houses led the market, up 3.4% year on year, followed by detached and terraced homes at 2.5% and 2.4% respectively. Flats, however, slipped 0.3%, extending a decade-long pattern of underperformance. “Over the last 10 years, the price of a typical flat has increased by around 20%, less than half of the rise for terraced houses,” Gardner added.
For landlords, this reflects tenant preference: family homes are commanding higher bids from renters, while flat values have stagnated. Marc von Grundherr, director at Benham and Reeves, noted: “London remains the outlier… but even the most modest gains equate to thousands of pounds in real terms given the capital’s higher values.”
Investor sentiment shaped by rates and politics
Agents report steady resilience, though many highlight political uncertainty ahead of the Autumn Statement. Guy Gittins, CEO of Foxtons, commented: “Sellers looking to complete before Christmas need to enter the market now with urgency.” Verona Frankish, CEO of Yopa, added: “The expectation is that momentum will only build as we enter a traditionally busy time of year.”
Yet questions remain over borrowing costs and taxation. Tanya Elmaz of Together cautioned that “further rate cuts may be few and far between should inflation remain elevated,” while also pointing to “uncertainty over potential changes in the tax regime.” For landlords, the prospect of targeted property taxes makes timing crucial.
Editor’s view
The latest data confirms a housing market that is calm on the surface but highly regional in character. Northern and devolved nations continue to offer landlords better house price growth, while southern England is cooling under supply pressures and political hesitancy. With flats underperforming and family homes driving both sales and rental demand, portfolio strategy matters more than ever.
