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Nationwide: house prices to rise 2% to 4% in 2025

ended 16. December 2024

Nationwide has just published its House Price Review and Outlook for 2025. It says the housing market has remained resilient in 2024 despite ongoing affordability challenges and expects house prices to see growth broadly in the range of 2% to 4% in 2025. Newspage asked property and financial experts for their views, below.

6 responses from the Newspage community

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Simon Bridgland
Broker at Charwin Private Clients
I think Nationwide have hit the first half of the year on the head. A mad rush in the first quarter then a lull whilst the dust settles. Subject to any political madness domestically or from around the world, a gradual increase will be seen over the latter part of the summer, buoyed by a long overdue reduction in the base rate. With so much open to instability across the globe it’s almost a coin toss for our economy, as a Chancellor scrambling for credibility goes cap in hand to Europe trying to convince them that the UK is open for business. The growth she craves is right in front of her, she just needs to let off the hand brake. Only then can we feel more confident that the property market will have the growth being predicted.
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Dariusz Karpowicz
Director at Albion Financial Advice
It seems the property market has thumbed its nose at the doom-mongers and will continue to do so in 2025. The fact that mortgage approvals actually bounced above pre-pandemic levels towards the end of 2024 is quite the feat, especially considering typical mortgage rates were hovering around 4.5%, a far cry from the comfy 1.5% we saw back in 2021. Looking ahead to 2025, Nationwide's forecast of 2-4% growth suggests the market's got plenty of fight left in it. While we might see a bit of a rush in the first quarter as buyers scramble to beat the stamp duty changes, the underlying trend looks promising. With interest rates expected to ease and wages finally outpacing house price growth, it seems the property market's resilience isn't just a happy accident - though perhaps we should hold off on popping the champagne corks just yet.
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Rohit Kohli
Director at The Mortgage Stop
Nationwide’s latest report shows the UK housing market has stayed surprisingly strong in 2024, even with ongoing affordability struggles. Looking ahead, house prices are expected to grow by 2% to 4% in 2025, which signals some steady progress. That said, high mortgage rates and soaring rents are still making it tough for first-time buyers to get on the ladder. The upcoming stamp duty changes could shake things up, with a rush of activity early in the year followed by a potential slowdown. But on the bright side, if interest rates ease and wages keep climbing, affordability might start improving as the year goes on. But that's a lot of uncertainty that needs to play out for that to happen.
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Ranald Mitchell
Director at bad credit mortgage specialists Charwin Mortgages
2024 has demonstated once again just how resilient the UK housing market can be, even in the face of significant affordability challenges. Looking ahead, 2025 is likely to be a bumpy ride for many, with market activity influenced by upcoming stamp duty changes and ongoing economic pressures. The easing of the base rate will provide some much-needed support, but the path forward remains uncertain for both those remortgaging, buying or selling as they navigating these conditions.
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David Stirling
Independent Financial Adviser at Mint Wealth
These figures may come as a surprise given the cost of borrowing on mortgages has increased so much. Coupled with the cost of living crisis and high utility bills, borrowers don't tend to have a lot of disposable cash to spend. The next three months should see a surge in property transactions as home-movers look to get completed before the April stamp duty deadline. This should hopefully spark a bit of a rate war among lenders, who will be looking to mop up some business before the anticipated lull into the summer. With various tax hikes from October's Budget hitting the economy in 2025, it could be quite turbulent, but the general feeling is borrowers should have a decent start to the year.
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Rakesh Dua
CEO at DUA Accountancy & Business Consultancy
The housing market has remained on a relatively firm footing this year due to resilient demand and the ongoing lack of supply. That's a trend that is likely to continue into 2025. 2025 is unlikely to see major house price growth as the economy is under pressure so a growth prediction of 2%-4% feels about right. With demand so high for properties under £600,000, house prices will keep going up at this level of the market. Even if there is a bolstered building programme and new planning rules are pushed through, resulting in more supply, that will take time to feed through and alter the market dynamic.