The latest Halifax House Price Index reported a month on month change of +1.3%. It stated that this is the biggest increase this year and has led to an annual increase of +4.8%.

Amanda Bryden, Head of Mortgages at the Halifax said –

“Latest figures continue to show improving levels of demand for mortgages, as an easing in mortgage rates boosts buyer confidence.”

She went on to say –

“As we move towards the end of the year and into 2025, positive employment figures and anticipated decreases in interest rates are expected to continue supporting demand. This should underpin further house price growth, albeit at a modest pace as borrowing costs remain above the average of a few years ago.”

The latest Nationwide Index also reported month on month growth at +1.2% with annual growth at +3.7%.

Robert Gardner, Nationwide’s Chief Economist said that this marked the fastest rate of annual growth in two years.

He went on to say –

“The acceleration in house price growth is surprising, since affordability remains stretched by historic standards, with house prices still high relative to average incomes and interest rates well above pre-Covid levels.”

The latest Hometrack Report stated a more conservative annual increase of +1.5%.

Richard Donnell, Executive Director of Research at Hometrack said –

“The housing market has returned to growth in 2024 thanks to rising incomes and lower mortgage rates. We expect house prices to rise by 2.5% over 2025 with 5% more sales compared to 2024. The best market conditions will be seen in regional markets where affordability is less of a barrier to moving. “  

In spite of rising house prices, the latest Rightmove Report which focuses on asking prices showed a drop of -1.7%. It stated that this is in line with the usual December monthly fall.

However, it did say that prices end the year +1.4% above December 2023 and that Rightmove predicts that prices to rise by +4% in 2025.

Tim Bannister, Rightmove’s Director of Property Science said –

“The number of sales being agreed is up by 22% compared with this time last year, while the number of new buyers contacting estate agents about homes for sale is up by 13%. This momentum is a good sign for another Boxing Day activity bounce. The prospect of last year’s bounce encouraged a record number of Boxing Day sellers to launch their properties onto the market in 2023. The resulting surge in fresh choice creates a virtuous circle of market activity, attracting potential New Year buyers – last year, buyer demand jumped by 273% between the Christmas Day lull and Boxing Day”

Our thoughts

In the main, the latest reports are positive for house prices. In spite of what feels like a challenging market, Halifax have reported annual growth of nearly 5%.

Although mortgage rates are higher than people would like, some lenders have reported that they are beginning to reduce rates again. Combine this with the Stamp Duty changes next year, it will be interesting to see what activity looks like in the first quarter of 2025 and what effect this has on house prices.

When combining the current reports with predictions for house prices and interest rate reductions next year, we are expecting reasonable growth in 2025.