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Despite negative expectations, house prices increased in 2024 and now look set to continue to grow into 2025. Here we look at what's happening with house prices now, what the experts say is likely to happen this year, why and what this means for you.
KEY INFORMATION
Average UK House Price : £269,000
Forecasted Growth for 2025: 2% – 4%
House price growth will be impacted by how quickly interest rates are cut, what happens in the wider economy, mortgage availability and government policy such as stamp duty changes.
Experts’ views
House price forecasts range from a low of 1.1% to a high of 4% from Nationwide and Rightmove. The prevailing view is that current market momentum is expected to carry into 2025 and that affordability pressures should continue to ease with mortgage rates expected to gradually fall over the year. But there is still some potential for a bumpy ride. Market confidence could be affected by stamp duty rises and inflationary pressures could mean it takes longer for interest rates to fall.
Paula Higgins at The HomeOwners Alliance says, ‘We predict house prices to continue a steady climb through 2025 increasing by 4% across the year.’
For the most comprehensive intel on house prices including what’s happening to house prices in your area and the outlook for house prices check out our monthly House Price Index. Our latest report indicates that across all the major house price indices house prices were on average down -0.2% over the past month and up +4% over the past year.
Sold prices are the most accurate indication of what’s happening with house prices. The most reliable measure is the Land Registry’s House Price Index.
Given the Land Registry records actual sold data, it takes several months for the data to update. Therefore, it’s useful to also look at house price data produced by the lenders Nationwide and Halifax. While this is more up to date, it’s based on mortgage valuations so offers a less comprehensive picture.
Looking at what’s happening with asking prices can also give us a useful overview of what’s currently happening in the UK property market. However, the downside is that these figures are about the price asked for by buyers, not the sold price eventually agreed.
| Index | Monthly change | Annual change |
| Land Registry | +0.0% | +5.4% |
| Nationwide | +0.0% | +3.9% |
| Halifax | -0.5% | +2.8% |
| Rightmove | +1.1% | +1.0% |
| Average (excluding Rightmove) | -0.2% | +4.0% |
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Yes, it’s looking likely.
Looking ahead into 2025, experts are predicting increases of between 2% and 4%.
But it’s worth noting that no one has a crystal ball and the experts often get it wrong. For example, Halifax’s house price forecast for 2024 was that prices could fall between -2% and -4%. In the event, the latest Land Registry figures from October 2024 show they in fact were up 3.4% year on year. It’s no surprise given the fact house prices can be influenced by a range of factors which we cover further on in this guide.
Despite their limitations, expert predictions are useful if you’re keen to understand what is likely to happen this year so let’s take a look.
KEY INFORMATION
If you’re reading this wondering whether to move home this year and “time the market” right, then a word of warning: if you’re in the market for a home to live in, and you find one you like, and that you can see yourself staying in for a while, and can afford it without too much of a struggle, then trying to second-guess house price indices is a waste of your time.
But, if you do want to ponder the point of a house move further, then have a read of our latest analysis in Is now a good time to buy a house? and Should I sell my house now?
A recent national survey of 2000 UK adults carried out by the HomeOwners Alliance in April 2025 found that 45% of Brits overall expect house prices to rise this year, while about a quarter (26%) think they will stay the same and only 10% think they will fall. The remaining 19% don’t know what to expect in terms of house prices.
Those who aspire to own their first home, are more likely than existing homeowners to expect house prices to go up this year (57% vs 41%). While existing homeowners are more likely than aspiring homeowners to expect house prices to remain steady (31% vs 19%).
Over the last 5 years, UK house prices have risen steadily, despite increased mortgage costs driven by interest rates hikes. The current average UK house price is £269,000 Land Registry data shows.
Looking at national house price trends and predictions is useful but there are regional variations in house prices so an area by area overview can help you understand how prices have changed near you. Below are the latest regional shifts and we’ve pulled together a report on the cheapest places in the UK.
According to Land Registry data, house prices increased in most areas of the UK over the last year. The biggest rises were in Northern Ireland (+9%), the North West (+8%), the North East (+7.9%) and Yorkshire & Humber (+7.5%). London is the region with the slowest annual house price growth but still with the highest average house price.
| UK Region | Monthly change | Annual change | Average price |
|---|---|---|---|
UK Region England | Monthly change +0.3% | Annual change +5.3% | Average price £291,640 |
UK Region Northern Ireland | Monthly change +1.5% | Annual change +9.0% | Average price £183,259 |
UK Region Scotland | Monthly change -1.5% | Annual change +5.7% | Average price £185,870 |
UK Region Wales | Monthly change -0.7% | Annual change +4.1% | Average price £207,382 |
UK Region East Midlands | Monthly change +0.4% | Annual change +6.0% | Average price £241,209 |
UK Region East of England | Monthly change 0.0% | Annual change +4.2% | Average price £338,468 |
UK Region London | Monthly change -1.1% | Annual change +1.7% | Average price £555,625 |
UK Region North East | Monthly change +0.4% | Annual change +7.9% | Average price £160,452 |
UK Region North West | Monthly change +0.7% | Annual change +8.0% | Average price £211,977 |
UK Region South East | Monthly change -0.3% | Annual change +4.6% | Average price £384,659 |
UK Region South West | Monthly change +0.7% | Annual change +3.9% | Average price £308,207 |
UK Region West Midlands | Monthly change +1.1% | Annual change +6.0% | Average price £246,636 |
UK Region Yorkshire & Humber | Monthly change +1.6% | Annual change +7.5% | Average price £205,455 |
Find out how much your house is worth with our online tool.
The Bank of England cut interest rates twice in 2024 which helped reduce mortgage costs and more cuts are expected in 2025 which is expected to lower mortgage borrowing costs further. When borrowing is cheaper and buyers can borrow more, this can lead to an increase in house prices. But challenges remain for first-time buyers in terms of saving a deposit and mortgage affordability. Read our guide on Mortgage advice for first time buyers.
Stamp duty changes that came into force on 1 April 2025 have made buying a house more expensive for many homeowners. First time buyers now pay stamp duty on properties over £300,000 instead of the previous threshold of £425,000. While home movers now pay stamp duty on properties over £125,000 rather than the previous threshold of £250,000.
As a result, a surge in property transactions is expected in the first three months of 2025. But demand for houses – and house price growth – may slow in the months that follow. We saw this trend with the previous government’s stamp duty holiday, announced in 2020, which temporarily allowed you to buy a home up to £500,000 without paying stamp duty.
There is a shortage of houses in the UK and as a result high house prices have made homebuying unaffordable for many. In Labour’s manifesto ahead of the 2024 General Election, the party set out its plan to restore mandatory house-building targets and pledge to build 1.5 million homes during its term.
The government is aiming for 370,000 new homes to be built in England every year. If the government does manage to consistently build hundreds of thousands of new homes annually, it’s likely that house prices will come down. But given how long it takes to build houses this would be unlikely to have an impact on house prices in 2025.
The wider economic climate contributes to house prices. If wage growth stagnates and unemployment rises, buyer demand or the price buyers can afford to pay may fall and this will have a knock-on effect on house prices. The UK economy is also impacted by global issues and we’ll have to wait and see the impact of Trump’s US presidency and what happens with trade tariffs.
Mortgage rates on fixed deals are falling in 2025 and expected to fall further over the year and this is good news for buyers as it makes buying a house more affordable. It also makes it easier for homeowners to borrow more to buy a more expensive house. This aligns with the predictions of moderate house price growth. But while this is what’s forecast to happen now it doesn’t mean it’s guaranteed. Read our guide on Mortgage rate predictions which outlines what’s forecast to happen and the factors that could disrupt that.
Also, read our guide on How much can you afford to borrow for a mortgage and to see instantly how much you may be able to borrow based on your income, use this how much can I borrow for a mortgage calculator.
Get fee free mortgage advice from our partners at L&C. Use the online mortgage finder or speak to an advisor today.
Predictions that house prices will rise further in 2025 isn’t good news for first time buyers who are already facing the toughest conditions in 70 years, according to a report by the Building Societies Association. Plus, changes to first time buyer stamp duty that came into effect in April 2025 have made buying even more expensive for some. But there is some help at hand when it comes to buying your first home.
There are a number of schemes to help you buy a home including:
Get fee free mortgage advice from our partners at L&C. Use the online mortgage finder or speak to an advisor today.
Expert house price predictions suggest modest growth of 1-4% during 2025 with no indications of a significant drop being likely.
Yes, potentially. There are lots of factors to take into account – and not just economic factors and house price forecasts. Assuming you can afford to buy a home, when you decide to do it is a personal decision based on a myriad of personal factors. Read our guide Is now a good time to buy a house which covers everything you need to consider.
Homes with a high energy efficiency are more desirable for some buyers as it means energy costs will be lower. There is also government help available for make your home more energy efficient – see our guide on Energy bills help.
Savills‘ house price prediction for the next 5 years is that the average UK house price will rise by a total of 23.4% by 2029 taking the average house price to £442,000.
The Bank of England is widely expected to continue to cut interest rates in 2025. When interest rates fall, mortgage rates normally fall too. And if the cost of borrowing falls and people can afford to borrow more on a mortgage, the house price forecast would be that prices could rise as a result.
In the last couple of years, various predictions of a house price crash were being bandied about. But as the figures show – this didn’t happen. There are no current indications that a house price crash is likely to happen.
HomeOwners Alliance Ltd is registered in England, company number 07861605. Information provided on HomeOwners Alliance is not intended as a recommendation or financial advice.
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