House prices are set for a gradual increase in the coming year, following a recent stagnant period, according to industry experts. Data from the Halifax reveals that average property prices saw minimal growth in November, edging up by £138 to reach a new record high of £299,898, nearing the £300,000 milestone.
Economists attribute this slowed growth to pre-Budget uncertainties, dampening buyer enthusiasm. However, with the possibility of a Bank of England rate cut in the near future, analysts anticipate a resurgence in price growth early next year.
While national prices have held steady, regional disparities are evident, with notable performance variations. For instance, Northern Ireland experienced a robust 9% annual increase in average property prices to £220,716, driven by a persistent demand-supply imbalance. Conversely, Greater London continues to struggle, with prices decreasing by 1% to an average of £539,766 in the previous month.
Overall, the UK witnessed a sharp decline in annual price growth, dropping from 1.9% to 0.7%. Amanda Bryden, head of mortgages at the Halifax, noted this as the weakest growth since March 2024, largely influenced by the strong growth observed the previous year.
Bryden highlighted that despite recent economic uncertainties, property values have remained stable, benefiting first-time buyers with improved affordability. Additionally, with current interest rates and expectations of further rate cuts, the market is expected to see gradual price increases into 2026.
In November, Scotland recorded a 3.7% annual growth in house prices, with the average property value standing at £216,781. Wales saw a 1.9% year-on-year increase, reaching an average value of £229,430. In England, the North West led in annual growth rate at 3.2%, with average prices at £245,070. London, despite the decline, remains the most expensive region in the UK.
Industry experts like Jason Tebb from OnTheMarket and Iain McKenzie from The Guild of Property Professionals highlighted regional market disparities and increased supply affecting price growth dynamics. Mortgage expert Karen Noye emphasized affordability challenges amidst market fluctuations and global economic pressures.
Sarah Coles, head of personal finance at Hargreaves Lansdown, pointed out the sluggish property market trend in 2025, emphasizing the impact of uncertainty on buying decisions. However, she expressed optimism for a potential market uptick in the new year, citing expected rate cuts and falling mortgage rates as possible catalysts for increased buyer activity.
Overall, the housing market outlook suggests a cautious but optimistic trend with expectations of gradual price growth in the upcoming year.