A comprehensive microscopic description of thermally induced distortions in lead halide perovskites is crucial for their realistic applications, yet still unclear. Here, we quantify the effects of thermal activation in CsPbBr₃nanocrystals across length scales with atomic-level precision, and we provide a framework for the description of phase transitions therein, beyond the simplistic picture of unit-cell symmetry increase upon heating. The temperature increase significantly enhances the short-range structural distortions of the lead halide framework as a consequence of the phonon anharmonicity, which causes the excess free energy surface to change as a function of temperature. As a result, phase transitions can be rationalized via the soft-mode model, which also describes displacive thermal phase transitions in oxide perovskites. Our findings allow to reconcile temperature-dependent modifications of physical properties, such as changes in the optical band gap, that are incompatible with the perovskite time- and space-average structures.