UK House Prices Surge £6,000 in a Month – Rightmove Predicts 2025 Will Still Favor Buyers
The UK housing market has started 2025 on a strong footing, with house prices rising at their fastest rate since April 2023. According to the latest Zoopla House Price Index, annual house price inflation reached 2% at the end of December, up from 0.9% a year ago. This marks a significant improvement in market conditions, reflecting growing confidence among buyers and sellers.
House Prices on the Rise Across the UK
The average UK house price now stands at £267,700, representing an increase of £5,200 compared to the previous year. While price growth remains modest compared to pre-pandemic levels, it signals a steady recovery in the housing market. Northern Ireland has emerged as the strongest-performing region, with house prices rising by an impressive 7.7%, largely due to a rebound from historically lower property values.
Other high-growth regions include North West England, where prices are up by 3.2%, reflecting the area’s sustained employment growth and strong demand from buyers. Cities such as Wigan (5.6%) and Motherwell (4.9%) have recorded some of the highest increases in average house prices.
North-South Divide: Southern England Lags Behind
While the northern regions are experiencing robust price increases, the southern parts of England are seeing much slower growth, with inflation below 1.5%. This is partly due to affordability constraints and a higher proportion of existing homeowners in the South who have been impacted by elevated mortgage rates over the past year.
Interestingly, despite the slower price growth, first-time buyer (FTB) demand is surging in London and the South East, suggesting that affordability improvements and increased housing stock may be attracting new entrants into the market. As a result, Zoopla expects these regions to see stronger near-term price growth as demand continues to pick up.
More Homes for Sale, More Buyers Entering the Market
One of the most notable trends in the latest report is the increase in housing supply. The number of homes available for sale is 10% higher compared to this time last year, providing buyers with more choices. The average estate agent branch now has 31 homes for sale, the highest January total in seven years.
Additionally, buyer demand has surged by 13% compared to last year, and 26% higher than at the start of 2023, indicating that more people are looking to move.
The data also shows that the number of sales agreed is up by 12%, as some buyers rush to complete transactions ahead of the reduced Stamp Duty deadline at the end of March. With a more balanced supply-demand dynamic, the market is expected to remain active throughout the year.
Market Outlook for 2025: What to Expect
Looking ahead, Zoopla forecasts that house prices will rise by 2.5% in 2025, supported by improving affordability, rising incomes, and potential base rate cuts by the Bank of England. They also predict that the number of property transactions will increase by 5%, bringing total sales to 1.15 million.
Mortgage rates have been steadily declining, which, combined with wage growth and reduced inflationary pressures, is expected to encourage more buyers into the market. Industry experts believe that these factors will contribute to a healthier and more resilient housing sector in the coming months.
Industry Experts Weigh In on Market Resilience
Richard Donnell, Executive Director of Research at Zoopla, stated:
“2025 is off to a better start than the previous two years. This bodes well for market activity over the rest of the year and is supported by more people looking to buy in the next two years.”
Similarly, John Tilzey, Sales Director at Finova, highlighted the resilience of the UK housing market, citing factors such as declining mortgage rates, wage increases, and easing inflation as key contributors to improved affordability. He remarked:
“As shown by today’s data, prices are gathering steam, marking a significant turnaround from this time last year. But as we look ahead to the year, the big question of ‘what’s next’ for the housing market remains.”
Kevin Roberts, Managing Director of Legal & General Mortgage Services, noted a rise in both first-time buyer activity and older homeowners re-entering the market, driven in part by the current Stamp Duty Tax thresholds. He stated:
“Our broker data shows that the volume of first-time buyers searching for mortgages has more than doubled since 2023, and this encouraging growth in borrower confidence may well continue this year.”
Mortgage-Tek: Helping You Navigate the Mortgage Market
With the UK housing market showing renewed strength, Mortgage-Tek is here to help you make the most of the opportunities available. Whether you’re a first-time buyer, a home mover, or an investor, navigating mortgage options can be complex. Our expert brokers specialize in securing competitive mortgage solutions tailored to your financial situation.
As the market continues to evolve, our team at Mortgage-Tek remains committed to providing expert guidance and access to the best deals. If you’re considering buying a home in 2025, let us help you secure the right mortgage solution with confidence. Get in touch with us today!