The latest UK House Price Index (HPI) revealed a 0.4% dip in house prices from October 2024, despite an annual rise of 3.3%, placing the average UK property value at £290,000.
England’s housing market mirrored the national average, with house prices declining by 0.4% month-on-month but rising 3% annually. The average property value now stands at £306,000.
The North East emerged as a standout region with prices climbing 1.1%, the highest in the UK.
Meanwhile the South West faced the steepest monthly decline, with prices falling by 1.8%.
ANNUAL DECREASE
In London, prices dropped by 1% in November 2024, contributing to a marginal annual decrease of 0.1%. The average property value in the capital now stands at £511,000.
Wales reported a 0.7% monthly decrease in house prices, yet an annual rise of 3% places the average property value at £219,000.
November 2024 saw an estimated 93,000 residential property transactions above £40,000, marking a 12.9% annual increase but a 7.9% decline from October.
With the highest monthly price increase (1.1%) and annual growth (5.9%), the North East’s housing market continues to outperform other regions
But while the UK’s annual house price growth of 3.3% offers a positive headline, the 0.4% monthly decline highlights underlying volatility.
Regional variances, from the North East’s booming market to London’s struggles, reflect a fragmented housing landscape shaped by local economic conditions and buyer sentiment.
INDUSTRY REACTION
Nathan Emerson, Chief Executive at Propertymark, says: “With many political and economic challenges currently dominating the news, the housing market has proven again that it can deliver growth despite the challenges faced.
“With keenness from many across England and Northern Ireland to complete before Stamp Duty increases take effect in April, it is imperative there is a strong sense of confidence for people to approach the market.
“Across the last quarter, our members have witnessed a positive uplift in the number of prospective buyers registering and an increase that represents a three-year high for the housing market.
“In addition, we have clarity that the Planning and Infrastructure Bill will be introduced to Parliament in March, which will empower the UK Government to make a start on their promise to deliver 1.5 million new homes before 2029.
“It does, however, remain imperative that there is clarity on where new homes will be built, together with how supporting infrastructure will be delivered.”
KNOCK-ON EFFECT
Jason Tebb, President of OnTheMarket, says: “This data is a little historic but shows house prices continued to rise on an annual basis in November, with the average property price £10,000 higher than a year ago.
“Two interest rate cuts in the second half of last year have had a positive knock-on effect on confidence, which the market relies so heavily on.
“With inflation dipping slightly to 2.5 per cent, it is heading back in the right direction albeit slowly, but if this trend continues it will ease pressure on the Bank of England to delay further rate reductions.
“Affordability remains a challenge with a number of lenders raising rates in recent days on the back of higher Swap rates but there has not been significant repricing. Sellers would be wise to take advice from their local agent and price sensibly if they want to successfully transact this year.”
DEFYING EXPECTATIONS
Iain McKenzie, Chief Executive of The Guild of Property Professionals, says: “A word that is frequently used about the property market is resilient, and this is because it continues to defy expectations.
“With the market starting in a stronger position than last year, it is expected that prices will continue to marginally grow over the course of the year, however, realistic pricing remains key.
“House prices have been underpinned by the increase in activity following the announcement regarding Stamp Duty changes, enticing many to move before the change in April.
“With mortgage rates still elevated, all eyes will be on the Bank of England, with many hoping for a rate cut at the next meeting in February.
“This should spur sentiment in the market and will hopefully have a knock-on effect on mortgage rates. Many are expecting a few rates cuts throughout 2025, but the frequency will depend on inflation playing its part.”
FINE HEALTH
Marc von Grundherr, Director of Benham and Reeves, says: “The market is in fine health all things considered, with house prices showing upward growth on an annual basis for the eighth month in a row and there’s widespread positivity when it comes to the outlook for 2025.
“Even across London, where house price growth has been largely static, we’re seeing more interest from buyers, more offers made and more sales being agreed.
“However, it remains a challenging landscape for homebuyers who continue to face numerous obstacles, not least the high cost of borrowing, with mortgage rates still sitting substantially higher than we’ve become accustomed to in recent years.”
BRISK START
Jonathan Hopper, Chief Executive of Garrington Property Finders, says: “The property market has made a brisk start to the New Year, with estate agents reporting a surge of interest from both buyers and sellers.
“But November’s fall in average prices serves as a chastening reminder to sellers of just how much competition they face in securing a buyer.
“Compared to October, the prices paid fell in more than half of England’s regions in November. Even though the annual figures still show a reassuringly sedate upward trajectory, the monthly data reveals just how keen pricing has become.
“This is also why regions where value is perceived as strongest are seeing prices rise rapidly. Prices in North East England jumped by 1.1% in November alone, and have surged by 5.9% on an annual basis. It’s a similar picture in the North West and in Yorkshire and the Humber, where annual price inflation is a breathless 5.7%.”
FULL STEAM AHEAD
Verona Frankish, Chief Executive at Yopa, says: ““The November figures show a marginal reduction in the monthly rate of house price growth, which is to be expected in the run up to Christmas.
“However, on an annual basis, house prices have continued to climb for the last eight months and it’s now full steam ahead where the property market is concerned, as homebuyers across England look to beat the stamp duty deadline.
“We’ve seen many times before how a sense of urgency drives demand across the market and the result of this heightened buyer activity is likely to be further house price growth over the coming months.”
CONSIDERABLE RESILIENCE
Jeremy Leaf, north London estate agent and a former RICS Residential Chairman, says: “The market felt fairly subdued towards the end of last year as one would expect as buyers and sellers tried to come to terms with the market realities of slower-than-previously-expected falls in borrowing costs.
“These figures are interesting as they cover not just mortgaged properties but the approximately third of transactions which are arranged without finance and show a considerable resilience despite the uncertainty prevailing at that time.
“Looking forward we are not seeing or likely to see any great changes in pricing or renegotiation but hopefully now with the slightly reduced inflation level, a cut in base rate will arise sooner rather than later.”
AFFORDABILITY ISSUES
Amy Reynolds, Head of Sales at Richmond estate agency Antony Roberts, says: “These numbers highlight the continuing pressure on affordability. Stubborn inflation continues to weigh on household budgets, and with the cost of borrowing still relatively high, potential buyers may sit on the fence until this changes.
“That said, we are seeing more applicants this month than in the final quarter of last year, some of whom are now in a position to buy because a first-time buyer has completed their chain. This leads me to have some concerns about the second quarter after the stamp duty holiday has ended.
“It has felt as though the market has been holding its breath this month, awaiting clarity on inflation figures and the Bank of England’s stance on interest rates.
“With the UK economy in a fragile state, we don’t anticipate any drops in base rate in the first half of the year – if anything, we could see fixed mortgage rates edge higher, which will have a negative bearing on activity.”
STRONGER THAN EXPECTED
Colby Short, Co-founder and Chief Executive of GetAgent.co.uk, says: “The annual rate of house price growth was stronger than expected in November and there’s no doubt that the government’s decision not to extend current stamp duty relief thresholds is helping to drive this trend.
“We’ve seen previously how a stamp duty deadline induced surge in demand can drive market performance and the expectation is that we will see strong growth over the first three months of this year.
“Once the clock does expire on current relief thresholds there will almost certainly be a market correction, most likely in the form of reduced transaction numbers and weaker rates of house price growth.
“However, the industry-wide view is that the impact of this stamp duty deadline will be far more marginal compared to previous examples and so the consensus is that 2025 will be a year of overarching stability and positive growth.”
TIME TO TRIM RATES
Mark Harris, Chief Executive of mortgage broker SPF Private Clients, says: “With inflation falling to 2.5 per cent, it’s time for the Bank of England to be bold and trim rates again in February.
“On the mortgage front, more lenders have raised rates than reduced them in recent days as Swap rates, which underpin the pricing of fixed-rate mortgages, have edged upwards over the past week.
“There is no reason to panic but borrowers would be wise to plan ahead as much as possible and seek advice from a whole-of-market broker to find the best deal for their circumstances.
“With stamp duty concessions ending in March, this could focus minds in the early months of the year, resulting in a busier spring market as buyers accelerate purchases.”
BIG PUSH
Tomer Aboody, Director of specialist lender MT Finance, says: “2024 saw a positive end to the year with more property transactions, along with an increase in pricing, illustrating how buyers and sellers were keen to take advantage of the lower rates on offer.
“As banks further reduced rates and affordability was more feasible, buyers wanted to act quickly amid concerns of a downturn in activity following the Chancellor’s Budget.
“As the new year gets underway, an imminent reduction in interest rates is looking less likely.
“We are therefore likely to see a big push in the first quarter as buyers take advantage of cheaper stamp duty and current lower rates, rather than put plans on hold yet again in the hope of further reductions.”
UNCERTAIN OUTLOOK
Jonathan Samuels, Chief Executive at Octane Capital, says: “The property market continues to stand strong, but whilst inflation figures saw a surprise dip today, the outlook still remains somewhat uncertain and we simply haven’t seen interest rates fall as swiftly as expected over the last six months.
“In fact, mortgage rates remain higher than they were this time last year and so those looking to purchase are best advised to tread with a degree of caution and avoid the temptation to over borrow in hopes of beating the stamp duty deadline.”
