The UK housing market has demonstrated robust resilience as the latest data from the Land Registry reveals an annual house price growth of 3.3% in November 2024. Despite consecutive monthly declines of 0.4% over the past three months, experts remain optimistic about the outlook for 2025, with landlords poised to benefit from a stable and competitive market.
Steady growth despite challenges
The average UK house price dipped slightly from £290,959 in October 2024 to £289,707 in November, continuing a pattern of small monthly decreases. However, on a year-on-year basis, house prices have risen steadily for eight consecutive months, starting at 0.4% growth in April 2024 and climbing to 3.3% by November.
Daniel Austin, CEO and co-founder of ASK Partners, views this as a sign of stability despite higher borrowing costs. “This rise in house prices marks a rebound from the unexpected recent fall. However, we believe this signals that growth this year is likely to face pressure and remain steady as higher borrowing costs start to affect buyers,” Austin explained.
For landlords and property investors, Austin highlighted a crucial opportunity: “The supply-demand imbalance continues to motivate investors and developers in the residential sector. Under the new government, we expect more projects to get off the ground, including co-living schemes that cater to younger professional buyers.”
Positive momentum in 2025
Market activity in late 2024 points to a promising start for the new year. Jean Jameson, Chief Sales Officer at Foxtons, noted significant momentum during the festive period: “December was a standout month for sales, with activity levels surging across key metrics, including a significant rise in viewings and new property instructions.”
Rightmove’s record-breaking Boxing Day traffic suggests strong buyer interest, particularly among first-time buyers hoping to act before the April 2025 stamp duty changes. “With property prices forecasted to rise by 3-4%, 2025 is shaping up to be a year of positive momentum, presenting strong opportunities for buyers, sellers, and investors alike,” Jameson added.
However, the high cost of borrowing remains a hurdle for many buyers. Jonathan Samuels, CEO of Octane Capital, advised caution: “Mortgage rates remain higher than they were this time last year. Buyers are best advised to tread carefully and avoid overborrowing in hopes of beating the stamp duty deadline.”
Rental market resilience
The rental sector also faces its own dynamics. Gareth Atkins, Managing Director of Lettings at Foxtons, anticipates modest rent growth of 3-5% in 2025. He believes supply levels will hold firm despite challenges, including the looming Renters’ Rights Bill. “Last year’s data showed resilience in rental supply even as some landlords reassessed their portfolios. This will be critical as we navigate legislative changes in the coming year,” Atkins explained.
The broader market sentiment remains optimistic. Marc von Grundherr, Director of Benham and Reeves, summed up the outlook: “The market is in fine health all things considered, with house prices showing upward growth on an annual basis for the eighth month in a row. Even across London, where growth has been largely static, we’re seeing more interest from buyers, more offers made, and more sales being agreed.”
What’s next for landlords?
For landlords, 2025 presents a unique opportunity to navigate a stable market while adapting to evolving buyer and tenant preferences. The combination of steady house price growth, robust rental demand, and a motivated pool of investors creates a favourable environment.
However, questions remain. Will stabilising mortgage rates and upcoming policy changes reshape the market further? Could the end of the stamp duty relief dampen growth later in the year?
