Outlook for housing market in 2025 – forecasts for house prices

Rightmove predicts national average asking prices will rise by 4% in 2025. While this is Rightmove’s largest prediction for price growth since 2021, it is in line with average long-term price growth.

The Covid-influenced years of 2020, 2021 and 2022 saw larger increases in prices. One factor for this was the imbalance between supply and demand – there was significant pandemic-driven demand for property, while supply was constrained.

The property portal expects the number of homes for sale to remain high next year, which means strong competition will remain for sellers and likely prevent higher price growth. However, these factors will also support agreed sales, and Rightmove anticipates a higher number of transactions in 2025, totalling around 1.15 million.

Nationwide says that provided the economy continues to recover steadily, the underlying pace of housing market activity is likely to strengthen gradually. This is expected as affordability constraints ease through a combination of modestly lower interest rates and earnings outpacing house price growth, with the latter likely to remain broadly in the 2-4% range in 2025.