House Prices Rise 3.7% in 12 Months

November brought an unexpected boost to the housing market, as revealed by the latest Nationwide House Price Index. The average price of a UK home rose by 1.2% month on month, with annual growth jumping to 3.7%, up from October’s 2.4%. House prices are now just 1% below the all-time high recorded in the summer of 2022.

These figures are adjusted for seasonal factors, meaning they account for the usual ups and downs of the housing market throughout the year. Without these adjustments, the average home was worth £2,406 more in November than in October, with the average house price increasing from £265,738 to £268,144.

Wait! What exactly is a House Price Index? 

A ‘House Price Index’ (or HPI) measures how property values rise or fall over time. Different HPIs are released by major property portals like Rightmove, the government, or mortgage lenders like Nationwide. Each one uses its own data, which can lead to slightly different results.

Most HPIs are updated monthly and often include market predictions, making them a valuable tool for understanding housing trends.

What caused this price uptick?

Experts believe that November’s growth is a short-term correction following October’s unexpectedly low figures. Buyer activity has increased, possibly driven by a rush to complete purchases before the March stamp duty deadline.

While this uptick is a positive sign, the underlying market challenges, such as high interest rates and stretched affordability, are likely to keep long-term house price growth moderate.

What does this mean for 2025?

Looking ahead, Yopa predicts a more active housing market at the start of 2025, fuelled by buyers aiming to beat the stamp duty deadline. As Mike Scott, Yopa’s Chief Analyst, explains:“The Nationwide House Price Index for November shows a surprising jump, with the price of the average house up by 1.2% in the month, and the annual rate of growth rising to 3.7% from 2.4% last month. This is likely to be a short-lived blip in reaction to last month’s surprisingly low figure, but we should expect some unusual housing market activity as buyers rush to complete their purchases by the end of March to beat the stamp duty deadline.”

Scott adds:“Yopa thus expects a more active start to 2025, with the rate of price growth picking up, though not returning to the rapid growth that we saw between mid 2020 and mid 2022.”

Beyond March, the market is expected to stabilise, with more modest house price growth compared to the pandemic boom years.

Is now the time to sell?

For sellers, this could be a prime opportunity. Increased buyer activity and urgency mean that well-presented and competitively priced homes may attract significant interest.

Article by Yopa written by Joey D'Rozario