House prices and sales volumes to grow in 2025, predicts Zoopla
It said the house sales market is on track to see 10% more completions this year than in 2023.
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.The number of house sales is expected to increase next year, with prices also edging up, according to a forecast.
Zoopla expects the number of sales to rise 5% over 2025, increasing to 1.15 million.
It said the sales market is already on track for 1.1 million completions during 2024 – 10% higher than in 2023.
Postponed home moves, an ageing population, rising running costs and changing working patterns will continue to impact moving decisions, the website predicted.
Zoopla said the number of sales being agreed in recent weeks is higher than a year ago, with buyer demand also having increased.
Higher income growth and lower mortgage rates have helped reset housing affordability faster than many expected over 2024
Rising incomes have helped the market adjust to higher mortgage rates, the website said, paving the way for continued modest growth in house prices.
Across the UK, property values are expected by Zoopla to increase by 2.5% on average during 2025, based on certain assumptions around mortgage rates.
House prices in the Midlands, northern England, Scotland and Wales are likely to outperform the UK average next year, while home prices in southern England, where property affordability pressures are more acute, will lag behind, according to the forecast.
Richard Donnell, executive director at Zoopla said: “The housing market has been resilient in the face of higher borrowing costs over the last two years.
“Higher income growth and lower mortgage rates have helped reset housing affordability faster than many expected over 2024. This has supported an increase in the number of sales and house prices over the year which we expect to continue over 2025.
“House price growth in southern England will continue to lag the UK average and incomes will need to rise faster than prices to help reset affordability and price more households into the market.
“First-time buyers will remain an important buyer group but existing homeowners looking to move will need more support to help realise their ambitions, with more and more having to look further afield to find better value for money.”
Matt Thompson, head of sales at London-based estate agency Chestertons, said: “As we are approaching the end of the year, we are already seeing more buyers entering the market, which is not typical for this time of year and a strong indication that 2025’s property market will be buoyant.
“One reason for the uplift in buyer activity are changes to stamp duty, announced in the autumn Budget. These will come into effect in April 2025, driving first-time buyers in particular to get on the property ladder before that deadline and will fuel a busy start to next year’s property market.
“Other buyer demographics, including families, couples, professionals and downsizers, considered 2024 a challenging year to buy a property amid political and economic uncertainty but now feel more motivated to resume their search in the new year.
“Contributing to the return of buyer confidence are lower interest rates, slightly more attractive mortgage products and the fact that the market has benefited from an uplift in the number of properties being put up for sale.”
Here are the postcode areas with the highest followed by the lowest house price growth over the 12 months to November this year in each region or nation of Britain, according to Zoopla (Northern Ireland is excluded from the figures but is included in Zoopla’s forecast for 2025):
East Midlands, Nottingham, 1.8%, Lincoln, 0.3%
Eastern England, St Albans, 1.0%, Ipswich, minus 1.1%
London Ilford, 1.6%, west London, minus 0.7%
North East, Durham, 3.7%, Teesside, 1.8%
North West, Wigan, 3.9%, Crewe, 1.9%
Scotland, Falkirk, 3.5%, Aberdeen, minus 0.3%
South East, Slough, 1.2%, Canterbury, minus 0.6%
South West, Plymouth, 1.5%, Dorchester, minus 1.2%
Wales, Swansea, 2.2%, Llandrindod Wells, 0.6%
West Midlands, Wolverhampton, 3.1%, Telford, 1.1%
Yorkshire and the Humber, Wakefield, 3.5%, York, 0.7%.