New seller asking prices dropped by a seasonal 1.7% (-£6,395) this month to £360,197, in line with the usual December monthly fall, with sellers’ pricing power diminishing as Christmas approaches, latest data from Rightmove reveals.
However prices have ended the year 1.4% above December 2023, and Rightmove predicts that new seller asking prices will rise by 4% next year, with forecast mortgage rate drops set to further improve affordability and stimulate market activity.
Despite the festive lull, activity remains substantially stronger than the same period a year ago, with the number of sales being agreed up by 22%, and new buyer demand up by 13%.
Some movers are now waiting for the traditional Boxing Day bounce. Boxing Day 2023 saw a record number of new sellers launching to the market for that time of year, providing fresh property choice for buyers, while buyer demand jumped by 273% between the Christmas Day lull and Boxing Day.
STAMP DUTY DEADLINE
Rightmove’s real-time data also captures the impact of the looming stamp-duty deadline on March 31st 2025. Sellers of smaller properties in higher-priced areas are trying to beat the deadline to avoid higher tax.
Prices are holding up best in the first-time-buyer sector, especially homes priced below the £300,000 threshold.
But despite the signs of a stronger 2025, headwinds remain, with the impact of Budget measures being a challenge.
WORKING HARDER
Tim Bannister Rightmove’s Director of Property Science, says: “New sellers in December have to work particularly hard to capture the attention of Christmas-party and festivity-distracted buyers, and the 1.7% average monthly fall is a fitting gift for those who are still buying homes rather than presents.
“Despite this monthly drop, prices have risen by 1.4% compared with this time in 2023, broadly in line with our prediction of a 1% rise in prices this year. We are now looking ahead to the traditional Rightmove Boxing Day bounce in home-mover activity, which has increasingly become a key date in the housing market calendar.”
Bannister adds: “Each year, our real-time data can pinpoint the exact moment that the turkey is finished, family games run out of steam, mobile devices are picked up, and prospective movers flood onto Rightmove and get their 2025 move started.
“If this year is anything like recent years, those early birds who get their search started the day after the festivities are over are likely to be rewarded with plenty of fresh property choice to consider.”
REASONS TO BE CHEERFUL
And he says: “Looking at our data and the UK’s underlying housing needs, there are lots of reasons to be positive about next year. However, as we’ve seen several times this year, the market is sensitive to unexpected events and the direction of travel can change.
“The stamp duty changes are a cloud over the market at the moment, with some groups much more impacted than others, and therefore keen to avoid the additional charges. After the important first three months of the year in 2025, a lot depends on how quickly normal activity is resumed with higher stamp duty in England.
“A Bank Rate cut and some mortgage rate falls early on in the year would help to settle the market and provide a boost to sentiment and consumer confidence.”
INCREDIBLE RESILIENCE
Nathan Emerson, Chief Executive of Propertymark, says: “Across the year we have witnessed the housing market show an incredible resilience with strong growth across the entire year overall.
“We have, however, seen many twists and turns, with the housing market duelling aspects such as high inflation, challenging interest rates, uncertainty surrounding the general election in July and the aftereffects on subjects such as Stamp Duty following the recent budget.
“Into 2025, we hope to see progress on a number of key subjects such as Planning and Infrastructure Bill, which will pave the way for the UK Government to kick start their ambitious plans of delivering 1.5 million new homes by 2029 and help level out the current mismatch between housing supply and demand.”
PROMISING 2025
Steven Holden, Director at Holden Copley in Nottingham, adds: “The property market has shown remarkable resilience this year, with sales activity remaining strong, which gives us optimism for a promising 2025.
“Naturally, December brings a seasonal slowdown in new listings as many shift their focus to the festivities.
“However, we expect the traditional post-Christmas surge in activity to kickstart the new year, with Boxing Day marking the beginning of a busy period.
“While the market remains robust, we’re mindful of challenges ahead, including the anticipated impact of stamp duty reverting to previous levels in April.”
BUSIEST DECEMBER
Matt Thompson, head of sales at Chestertons, says: “We are seeing one of the busiest Decembers in years in terms of buyer demand.
“This is mostly driven by first-time buyers who are keen to get on the property ladder before next year’s changes to Stamp Duty but also by second-steppers including young families, wanting to upsize.
“Looking to 2025, despite the uplift in buyer enquiries, rapid price increases are unlikely, however, improved affordability, pent-up demand and renewed confidence in the market should provide support for steady growth in property values.
“As such, we predict property prices to rise by 3.4% across the UK and 3% in London in 2025.”
BETTER HEALTH
Tom Bill, head of UK residential research at Knight Frank, adds: “The UK property market appears to be in better health than it is.
“There will be downwards pressure on activity and prices as the impact of higher mortgage rates since the Budget starts to feeds through.
“Meanwhile, a number of buyers are acting ahead of April’s stamp duty increase, which is temporarily boosting demand.
“A more profound sense of confidence will only return once the UK economy is heading decisively in the right direction and more sub-4% mortgages become available.”
