UK House Price Growth Slows by End of 2025
The UK housing market experienced a notable slowdown in price growth by the conclusion of 2025. Average house prices rose only 0.6% annually, a decrease from 1.8% in November, marking the slowest growth since April 2024. Monthly statistics reveal a 0.4% decline in December, reflective of higher comparative values from previous periods.
Overview of Housing Market Trends
- Annual Price Growth: 0.6% at year-end 2025
- Monthly Change: -0.4% in December
- Average House Price: £271,068 in December
Robert Gardner, Chief Economist at Nationwide, pointed out that this decrease stems from a high comparative base. Also influencing the figures were persistent uncertainty among consumers and elevated mortgage rates.
Regional Insights
Most UK regions experienced marginal house price growth this year. Northern Ireland outperformed others with a remarkable 9.7% increase, far above the national average of 1.7%. Comparatively, the only region reporting a decline was East Anglia, which saw an annual drop of 0.8%.
Annual Price Changes by Region
| Region | Average Price (Q4 2025) | Annual % Change |
|---|---|---|
| Northern Ireland | £216,919 | 9.7% |
| North West | £225,665 | 3.5% |
| Wales | £213,894 | 3.2% |
| England | £310,005 | 1.2% |
| East Anglia | £269,912 | -0.8% |
England’s annual growth slowed to 1.2%, with London exhibiting timid progress at 0.7%. In contrast, Scotland mirrored the national trend with a growth rate of 1.9%.
Types of Properties and Their Performance
In terms of property types, semi-detached homes experienced the most significant price increase at 2.4%. Detached properties followed closely at 2.2%. However, flats saw a decline of 0.9% year-on-year, reflecting ongoing shifts in housing preferences post-pandemic.
Future Outlook for UK House Prices
Looking ahead to 2026, experts predict a gradual uptick in market activity as affordability improves. Income growth is expected to outpace house price increases, while a decline in mortgage rates may also help stabilize the market. Predictions estimate annual house price growth between 2% to 4% next year.
The potential impact of new property taxes introduced in the recent Budget remains uncertain, with minimal immediate effects expected on the housing market. As the landscape evolves, the demand for rental properties might face pressures due to reduced supply, potentially maintaining upward pressure on rental growth.
