UK house prices rose by 4.7% in 2024, says Nationwide

UK home costs ended 2024 some 4.7% larger than at the beginning of the yr, in line with the Nationwide.

Property costs and housing market exercise remained “remarkably resilient” regardless of affordability challenges going through patrons, the lender stated.

The common residence within the UK price £269,426 on the finish of December, its figures present.

Regardless of the newest rise, the typical price stays under the height seen in the summertime of 2022.

The Nationwide, the UK’s largest constructing society, stated costs of terraced houses rose quickest throughout the yr.

Northern Eire noticed the quickest worth development, its mortgage information exhibits, with values additionally rising quicker in northern England than within the south, though all areas noticed a rise.

An absence of certainty over curiosity and mortgage charges, in addition to upheaval attributable to adjustments to stamp obligation, might make 2025 tough to navigate for patrons and sellers.

Housing consultants predict the market will see the variety of gross sales enhance over the subsequent few months, forward of the stamp obligation adjustments scheduled for April, earlier than falling away afterwards.

Home patrons in England and Northern Eire will begin paying stamp obligation on properties over £125,000, as a substitute of over £250,000 in the meanwhile.

First-time patrons presently pay no stamp obligation on houses as much as £425,000, however this can drop to £300,000 in April.

There are additionally widespread expectations that the Financial institution of England will steadily cut back rates of interest all year long, probably beginning in February, giving confidence to lenders to chop the price of new mounted mortgage offers.

Nevertheless, Financial institution of England governor Andrew Bailey just lately stated “the world is simply too unsure” to make correct predictions of when interest rates would fall, and by how a lot.

Robert Gardner, Nationwide’s chief economist, stated that home costs remained excessive relative to common earnings at the beginning of 2024, which meant that elevating a deposit was robust for potential first-time patrons.

“This can be a problem that had been made worse by file charges of rental development in recent times, which has hampered the power of many within the personal rented sector to save lots of,” he stated.

And Holly Tomlinson, monetary planner at funding agency Quilter, stated: “The looming adjustments to stamp obligation are prone to make buying much more tough for first-time patrons, including additional prices at a time when each penny counts.”

Some lenders have predicted that falling mortgage charges and rising wages ought to enhance housing affordability throughout this yr.

UK Finance, the lenders’ commerce physique, has forecast a ten% rise in mortgage lending for home purchases throughout 2025, though some analysts have already questioned this prediction as optimistic for lenders.

Additional forward, it’s anticipated many individuals will once more discover it robust to afford to maneuver or purchase a brand new residence in 2026.

Eight in 10 mortgage clients have fixed-rate offers. The rate of interest on this sort of mortgage doesn’t change till the deal expires, often after two or 5 years, and a brand new one is chosen to interchange it.

Even when mortgage charges fall this yr, charges will nonetheless stay larger than many householders are paying on the present mounted deal.

The Financial institution of England estimated that about 4.4 million mortgage holders are anticipated to see funds rise by 2027.

It stated a typical owner-occupier coming off a hard and fast fee within the subsequent two years would see their month-to-month mortgage repayments enhance by round £146.

Nationwide’s home worth information is predicated by itself mortgage lending, which doesn’t embrace patrons who buy houses with money, or buy-to-let offers. Money patrons account for a few third of housing gross sales.

Rival lender, the Halifax, will publish its last 2024 information within the coming days.