House prices are anticipated to experience gradual growth in the upcoming year following a recent slowdown, as per experts. Data from the Halifax, a mortgage lender, reveals that average property prices nearly stagnated in November, increasing by only £138 to reach a new high of £299,891, coming close to the £300,000 milestone.
Economists attribute this subdued growth to pre-Budget uncertainties, leading to a cautious approach among buyers. However, with the possibility of a Bank of England rate cut in the near future, analysts believe that price growth could accelerate in early 2026.
While national prices remained stable, certain regions outperformed others. Notably, Northern Ireland saw a significant increase of almost 9% in average property prices year-on-year, reaching £220,716, driven by a supply-demand imbalance. Conversely, Greater London continued to face challenges, with prices dropping by 1% to an average of £539,766 last month.
The annual growth rate for house prices in Scotland was 3.7% in November, with the average property value at £216,781. In Wales, prices rose by 1.9% year-on-year to reach £229,430. The North West of England recorded the highest annual growth rate at 3.2%, with property prices averaging £245,070. London, despite experiencing a decline, remains the costliest part of the UK.
Experts in the housing market, like Jason Tebb from OnTheMarket and Iain McKenzie from The Guild of Property Professionals, acknowledge the varying regional trends impacting the market. Karen Noye, a mortgage expert at Quilter, highlights that while market conditions are stabilizing post-Budget, affordability remains a key concern for borrowers.
Sarah Coles, head of personal finance at Hargreaves Lansdown, emphasizes the sluggish growth in house prices and the impact of economic uncertainty. She anticipates a potential uptick in the market in the new year, supported by potential rate cuts and falling mortgage rates.
In summary, the housing market is expected to see gradual growth in 2026, driven by factors such as interest rate adjustments and market stability, offering both challenges and opportunities for buyers and sellers alike.