House Prices Near £300,000 as Market Defies Seasonal Trends

Average Prices Reach New Record High

The latest Halifax House Price Index reveals that UK house prices climbed for the fifth consecutive month in November, reaching an average of £298,083. This record-breaking milestone highlights continued resilience in the market, even during the typically quieter winter period.

Lower mortgage rates appear to be bolstering buyer activity, despite the tax increases outlined in the Autumn Budget. Some purchasers may also be rushing to secure transactions ahead of changes to stamp duty thresholds set for April next year.

While these factors underpin current momentum, affordability challenges remain a significant hurdle for many. Amanda Bryden, Halifax’s Head of Mortgages, commented, “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.”

Regional Highlights

Property prices are rising across all regions, with Northern Ireland leading the way with a 6.8% annual increase. The North West of England followed with 5.9% growth, while the West Midlands saw typical property values rise by 5.5%.

London remains the priciest region, with average values at £545,439—up 3.5% year-on-year.

Nicky Stevenson, Managing Director of Fine & Country, noted, “Market activity typically slows at this time of year, but this rise in house prices suggests many buyers are pressing ahead despite seasonal trends. This could reflect a desire to finalise purchases before tax increases or changes to stamp duty thresholds.”

From April 2025, the standard stamp duty threshold for home movers will revert to £125,000 (from £250,000), and the first-time buyer exemption will drop from £425,000 to £300,000.

Future Market Predictions

Although average house prices appear set to end the year on a high, experts predict more modest growth in the years ahead.

• Knight Frank anticipates a 3% rise in house prices for 2024 but has revised its 2025 forecast to 2.5% due to the impact of the Autumn Budget on borrowing costs.
• Zoopla predicts growth of 2% in 2024 and 2.5% in 2025.
• Savills expects similar trends, forecasting 2.5% growth for 2024 and 4% in 2025.

For prime properties, higher taxes and changes to non-dom status are likely to weigh on the market. Prime central London homes could experience a 4% decline in 2025, as wealthy buyers face increased costs and tougher negotiations.

As Jonathan Hopper, CEO of Garrington Property Finders, explained, “The supply of quality prime homes is strong, and buyers at this end of the market are often able to negotiate hard on price, keeping prime price growth more subdued.”

Is Now the Time to Buy or Sell?

The current market conditions suggest it could be an opportune time to sell, with house prices at record highs and buyer demand remaining strong. For buyers, acting sooner rather than later might be wise as tax changes loom, and borrowing costs continue to influence affordability.

For any further property insights please give Mark and Chris a call.