PwC comments on the latest ONS house price data - August 2026

Commenting on the latest ONS house price data, Paige Tao, Economist at PwC UK, says:

“The UK housing market remained subdued in June. Prices barely moved on the month and activity points to a market still operating below potential: transactions were broadly unchanged in June, while mortgage approvals remained near two-year lows.  

“Affordability remains the main constraint. While wages are outpacing house prices, higher mortgage costs are absorbing much of that gain, as borrowing costs reached their highest level in more than a year in June. With housing demand particularly sensitive to borrowing costs, a durable recovery in activity will likely require mortgage rates to settle lower. That in turn depends on an inflation outlook that remains unclear, and on how soon the Bank of England feels able to respond.  

“The regional picture is becoming more divided. The North West recorded the strongest price growth in England, while London had now seen ten consecutive months of annual house-price falls by June, with weakness concentrated in Inner London. London’s underperformance is more than the mortgage rate story. High starting valuations, higher transaction costs and greater sensitivity to international demand mean the capital is having to adjust more than most regions.  

“There are reasons for cautious optimism. While the first six months of 2026 was more challenging than many expected, the UK economy has proved remarkably resilient. June’s 0.3% rise in GDP provides a firmer starting point for the months ahead, while the new Prime Minister has an opportunity to put housing affordability and new supply higher up the agenda.”