House prices are forecasted to experience gradual growth in the upcoming year following a recent pause, as per experts. Data from the Halifax, a mortgage lender, indicates that average property prices saw minimal increase in November, rising by £138 to reach a new high of £299,890, nearing the £300,000 threshold.
Economists attribute this sluggish growth to apprehensions leading up to the Budget, but with the possibility of a Bank of England rate reduction soon, they anticipate a resurgence in price growth by early 2026.
While national prices remained stable, certain regions outperformed others. Notably, Northern Ireland witnessed a nearly 9% surge in average property prices year-on-year to £220,716, reflecting a shortage in housing supply relative to demand. Conversely, Greater London continued to struggle, with prices dropping by 1% to an average of £539,766.
The annual price growth rate across the UK decelerated notably last month from 1.9% to 0.7%. Amanda Bryden, the head of mortgages at the Halifax, noted that this was the slowest growth since March 2024, citing the impact of stronger growth rates in the previous year.
Bryden highlighted that despite uncertainties surrounding the Budget and changes in stamp duty earlier in the year, property values have held steady. This slower growth may disappoint existing homeowners but is advantageous for first-time buyers, given the improved affordability compared to recent years.
Looking ahead, with stable market activity and expectations of further interest rate cuts, property prices are expected to continue a gradual upward trend into 2026. In November, Scotland recorded a 3.7% annual increase in house prices, with the average property value at £216,781. Meanwhile, Wales saw a 1.9% rise in property values year-on-year, reaching £229,430. In England, the North West exhibited the highest annual growth rate, with property prices rising by 3.2% annually to £245,070, while London remains the priciest region in the UK.
Jason Tebb, president of OnTheMarket, commended the housing market’s resilience in 2025, highlighting regional disparities in performance. Iain McKenzie, chief executive of The Guild of Property Professionals, emphasized the increased supply of homes compared to the previous year, which has moderated price growth in the short term.
Karen Noye, a mortgage expert at wealth manager Quilter, noted that post-Budget clarity has provided borrowers with visibility into early 2026 conditions. She highlighted affordability challenges, emphasizing that mortgage pricing remains sensitive to market shifts and global economic pressures.
Sarah Coles, head of personal finance at Hargreaves Lansdown, expressed that house price growth has been sluggish, attributing this to uncertainties and a weakening labor market. She suggested a potential upturn in the new year, backed by potential rate cuts and declining mortgage rates, which could enhance affordability and stimulate market activity.