Analysis of movement in house price indices

Each month, Halifax, Nationwide and HM Land Registry publish house price indices, tracking the movement in average house prices in the UK. Halifax and Nationwide updates are based on mortgage approvals data, while the UK HPI is a joint production by HM Land Registry, Land and Property Services Northern Ireland, ONS and Registers of Scotland.

House price indices begin 2025 with continued strong growth

Annual movement in UK house prices was up in January 2025, according to both Halifax and Nationwide’s indices.

Halifax reported a 3.0% annual increase in house prices, while Nationwide’s index showed an increase of 4.1% on the same period.

Dr David Crosthwaite, Chief Economist at BCIS, said: ‘The base rate cuts and tinkering with stamp duty appear to be having an effect on house price growth as buyers rush to complete before the deadline. It will be interesting to see if this momentum is maintained after April.’

On a monthly basis, Halifax said prices were up by 0.7% on December 2024, while Nationwide’s index showed a 0.1% increase.

Amanda Bryden, Head of Mortgages at Halifax, said affordability remains a challenge for many would-be buyers, though there is strong demand for new mortgages and growth in lending.

She said: ‘With a stamp duty increase looming, some of this demand may have come from first-time buyers eager to complete transactions before the end of March.

‘But the fundamental issue in the housing market remains the lack of supply. This long-term trend, coupled with a gradual improvement in affordability, should support further modest house price growth this year.’

Nationwide’s Chief Economist, Robert Gardner said the housing market continues to show resilience despite ongoing affordability pressures.

He said: ‘While there has been a modest improvement over the last year, affordability remains stretched by historic standards. A prospective buyer earning the average UK income and buying a typical first-time buyer property with a 20% deposit would have a monthly mortgage payment equivalent to 36% of their take-home pay – well above the long-run average of 30%.’

The UK HPI, with the latest data for December 2024, showed a 4.6% increase in house prices compared with December 2023, and a 0.1% decrease on November 2024. As the UK HPI figures cover house sales that may have been agreed months previously, there tends to be a lag in the data.

^{Source: Halifax (Methodology), Nationwide (Methodology), UK HPI (Methodology)}

The latest regional data from Nationwide shows Northern Ireland, the North and the North West saw the greatest annual increases in 4Q2024, while East Anglia showed an annual increase of just 0.5% in the same period.

^{Source: Nationwide}

To keep up to date with the latest industry news and insights from BCIS, register for our newsletter here.