UK house prices rose 1.2% year on year last month, the first annual gain in fourteen months, as easing mortgage rates and rebuilding real incomes combine to restore some affordability at the margin. The recovery is led by the North West and Scotland, both up more than 3% on the year, while London remains the laggard, still in low single-digit annual decline in several boroughs.
The regional divergence is now the defining feature of this cycle, not a footnote to it. Northern and Scottish markets never re-rated as sharply relative to incomes during the 2020-2022 boom, leaving them with more headroom to recover as rates ease; London and the wider South East rose furthest from trend and have correspondingly further to normalise.
"This isn't a national recovery yet. It's a patchwork, and the pattern is almost the exact inverse of where growth was strongest three years ago."
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