The Balancing Act of the Pound, September 2026 Inflation & Affordability Update
Have you ever wondered why a property that felt completely out of reach five years ago might actually be more accessible today, even if the price tag is higher? It sounds like a riddle, but the answer lies in the invisible tug-of-war between the prices you pay at the high street and the numbers you see on your payslip.
To understand where the property market is headed, we first need to look at the "hidden thief" in all our pockets: inflation.
Inflation: The cost of living in simple terms Think of inflation as the speed at which your money loses its "muscle." When we say the CPI Annual Inflation Rate is 3.1% this September, it means that, on average, a basket of goods that cost you £100 this time last year now costs £103.10.
Whether it is the price of a pint of milk, filling up the family car, or your favourite morning coffee, inflation is the measure of how much extra change you’re having to dig out for the exact same things. When inflation is high, your money feels "weaker." When it stabilises, as we are seeing now, it gives everyone a chance to catch their breath.
Are you winning the race? The good news is that while prices are rising at 3.1%, our collective paycheques are growing faster. Average earnings have grown by 4% over the last year.
Here is the Affordability Signal you need to know: Because your wages are growing faster than the cost of living, you are experiencing "positive real wage growth" of about 0.9%. In plain English? You have slightly more "spare" money at the end of the month than you did a year ago. Your purchasing power is slowly but surely getting its strength back.
What this means for your next move With the Bank of England Base Rate holding steady at 3.75%, the mortgage landscape feels significantly more predictable than the roller coaster of previous years.
If you are thinking about buying or remortgaging, this 0.9% boost in "real" money is vital. It’s the difference between a lender looking at your bank statements and seeing a household that is squeezed, versus one that has a little bit of breathing room. While average house prices have crept up to £287,949 (a modest 1.8% annual rise), the fact that wages are outperforming both inflation and house price growth is a massive win for affordability.
The View from null How does this national picture look when we zoom into our corner of the world in null?
In a local market like null, where the average asking price sits at £547,814, these national trends act like a thermostat. When people across the country feel wealthier because their wages are beating inflation, it boosts confidence here too. However, because we are currently in a "buyer’s market" in null, with 328 properties for sale and about 25 selling each month, buyers have the upper hand. The extra "purchasing power" from wage growth means local buyers can be more selective, while sellers need to be realistic to secure a deal.
Looking Ahead We aren't back to the "cheap money" era of a decade ago, but we are in a much healthier place. The "seesaw" is finally tilting in favour of the consumer. As we head into the autumn, the combination of rising wages and steadying prices suggests a period of calm, sustainable growth. If you’ve been waiting for the "right time," the data suggests that your money is finally starting to work harder for you again.