House prices rise 2.7%: where home equity is growing fastest

The national picture

The ONS and HM Land Registry UK House Price Index for May 2026 shows the average UK property selling for £271,000 — a 2.7% rise compared with May 2025. That is a slowdown from the 3.9% annual growth recorded in April, but the moderation is largely a base effect: the April 2025 Stamp Duty Land Tax changes prompted a rush of completions, producing an unusually high comparison point for this year’s data. In cash terms, prices continued to rise across most of the country.

England averaged £292,000, up 2.3% on the year. Wales rose 4.2% to £215,000. Scotland grew 4.4% to £196,000. Northern Ireland, measured on a quarterly basis, saw the strongest performance of any UK nation at 7.4% growth, reaching an average of £198,000 in Q1 2026 compared with Q1 2025.

Where equity is growing fastest

Within England, the regional spread is substantial. The North East recorded 5.9% annual price growth — the strongest of any English region — driven by a combination of relatively affordable base prices and sustained demand. Yorkshire and the Humber, the East Midlands, and the North West also outperformed the national average, continuing a pattern of stronger growth in regions where properties are more attainable and the supply of homes more responsive to demand.

For homeowners in these regions, consistent price growth means that equity has been accumulating steadily. A property worth £200,000 five years ago and now worth £240,000 carries £40,000 more equity than it did — and that increase flows directly into the calculation of how much can potentially be released under a later-life lending arrangement.

Wales and Scotland have both seen stronger-than-England growth over recent years, and the May 2026 data confirms that pattern continuing. Northern Ireland has sustained particularly strong momentum, with the 7.4% annual rise reflecting a market that has benefited from relative affordability and growing demand from both domestic and cross-border buyers.

London: a different picture

London remains an outlier. Prices fell 3.7% in the year to May 2026 — the ninth consecutive month of annual decline. The falls are concentrated in higher-value properties and central boroughs, where the correction from post-pandemic highs has been most pronounced. Outer London and more affordable areas have seen smaller movements, but the overall direction has been consistently downward for the better part of a year.

For London homeowners considering later-life lending options, a period of price softness does not remove the option entirely. What matters is the current market value of the specific property and the equity it holds — which, for most long-standing London homeowners, remains very substantial even after a year of modest price falls. A property purchased in 2005 for £250,000 that peaked at £650,000 and is now valued at £620,000 still represents £620,000 of potential equity, less any outstanding mortgage.

Regional averages are a useful starting point for understanding market direction, but they are not the right tool for understanding what any individual property is worth or what equity it holds. That requires a current valuation of the specific property.

Why regional data matters for equity release

The amount available under a lifetime mortgage or retirement interest-only arrangement is calculated as a percentage of the property’s current market value — a percentage that also varies by the age of the youngest homeowner. A property valued at £350,000 and a property valued at £400,000, with the same owner at the same age, will produce different maximum loan amounts even if everything else is identical.

This means that changes in local property values feed directly into the equity release calculation. Homeowners in regions that have seen sustained price growth may find that the sum available today is higher than a quote they received two or three years ago — not because the product has changed, but because the underlying property value has risen. Equally, homeowners in areas that have seen prices soften may find that the available sum has changed in the opposite direction.

The only way to know the current figure for a specific property is a current valuation. Any lender offering a lifetime mortgage or RIO product will arrange an independent surveyor valuation as part of the application process, and it is that valuation — not regional averages — that determines the actual maximum available.

“National averages are context. Your property value is the number that matters — and that number may have moved more than you expect since you last checked.”