House prices stall as a rate rise looms this week

UK house prices barely moved in October, fewer buyers are getting mortgage approvals, and the Bank of England announces its next interest rate decision on Thursday. Here is what the latest figures say, and what they could mean in Surrey and south-west London.

Figures correct as of 3 November 2026.

The numbers this week

Nationwide’s October index, published on 30 October, put annual house price growth at 0.5%, down from 0.8% in September and the weakest since January 2024. The average price was £273,566, compared with £274,251 in September and £278,880 at the April peak, so prices are almost 2% below that high. Reporting of the seasonally adjusted monthly change was flat. Nationwide’s economist pointed to geopolitical tensions and higher energy prices feeding inflation worries, and expects the market to regain momentum once that energy shock fades.

Activity tells a similar story. Bank of England figures for September, reported on 29 October, show 53,400 mortgage approvals for house purchase, down from 54,800 in August and about 19% lower than a year earlier. That is the third monthly fall in a row and the lowest since December 2023. Remortgage approvals went the other way, rising to 42,600 from 34,000, which suggests many homeowners are arranging new deals as their existing ones end.

Mortgages and interest rates

Bank Rate stands at 3.75%, where it was held on 17 September, although three of the nine Monetary Policy Committee members voted for an increase at that meeting. The next decision is due on Thursday 5 November. Many commentators expect a quarter-point rise to 4%: a Reuters poll of 63 economists in mid-October, reported by the HomeOwners Alliance, found 54 expecting one. Inflation, as measured by CPI, rose to 3.5% in September from 3.1% in August, according to figures released on 21 October.

These are forecasts, and the committee may decide differently. A rise would mostly affect people on tracker or standard variable rate mortgages straight away, while fixed-rate borrowers would feel it when their deal ends or when they take out a new one. Lenders often move their pricing ahead of a decision, so anyone with a mortgage plan in progress may want to speak to a qualified adviser about how their own situation could be affected.

It is also worth keeping the national picture in proportion. A flat month after a year of slow growth is not a collapse, and Nationwide itself expects the market to recover once energy-related pressure on inflation eases. At the same time, the fall in purchase approvals shows that affordability is stretching buyers, and the rise in remortgaging suggests that many households are focused on managing existing borrowing rather than moving. Both sellers and buyers in this area may find that deals take a little longer to agree than they did earlier in the year, and that lenders’ valuations and criteria matter more. Where sources disagree on a detail, such as how the October monthly change is reported, this article uses the figures published by the index provider and notes the difference.

What this means for Surrey and south-west London

The most recent local data is the HM Land Registry index for August, published on 21 October. It shows Surrey at an average of £524,334, 0.2% lower than a year earlier, against England up 0.4%. Within the area the picture is mixed. Elmbridge, which covers Esher, Cobham and Weybridge, averaged £735,548, up 0.7%. Merton was at £623,791, up 0.1%, while Wandsworth, at £694,210, was 5.3% lower than a year before, and Kingston upon Thames, at £597,587, was 4.9% higher. Monthly local figures can swing, so one month should not be read as a trend.

For buyers, a quiet national market and falling approvals can mean more choice and more room to negotiate, though higher borrowing costs may limit what some can afford. For sellers, realistic pricing matters more when fewer buyers are getting mortgage approval. Landlords and investors will be watching the rate decision for the effect on borrowing costs. The Land Registry’s September figures, when they arrive, should add more local detail.

Sources

• Yahoo Finance UK, reporting Nationwide’s October house price index (30 October 2026)
• Mortgage Solutions, Nationwide October house price growth (30 October 2026)
• Mortgage Solutions, reporting Bank of England September mortgage approvals (29 October 2026)
• HomeOwners Alliance, interest rate predictions and 5 November decision (updated 2 November 2026)
• The Negotiator, Bank of England rate decision expectations (2 November 2026)
• HM Land Registry, UK House Price Index for August 2026 (21 October 2026)

This article is general information, not financial or mortgage advice. Property values can go down as well as up. Please speak to a qualified mortgage adviser before making borrowing decisions.