UK house prices picked up towards the end of 2025 with annual growth accelerating across most regions while London lagged, according to the latest ONS figures.
The average UK house price rose 2.5% to £271,000 in the year to November, up from a 1.9% increase in October, signalling a gradual recovery in market activity.
In England, the average home reached £293,000, up 2.2%, while Scotland recorded a stronger 4.5% rise to £193,000.
Wales lagged at 0.7%, with an average price of £209,000. Northern Ireland continued to see robust growth, with prices up 7.1% to £193,000 in Q3 2025.
Within England, the North East led inflation at 6.8%, while London remained the weakest market, with prices falling 1.2% over the year, though this was an improvement on October’s 2.6% decline.
London’s subdued growth may reduce bridging and high‑loan‑to-value activity.
While London’s subdued growth may reduce bridging and high‑loan‑to-value activity in the capital, stronger performance in Northern England, Scotland, and Northern Ireland continues to support demand for bridging finance, especially for buyers looking to move quickly in a rising market.
Rents are also starting to ease, offering some relief to tenants and influencing investment decisions in the PRS and BTL sectors.
Average UK monthly private rents rose 4.0% to £1,368 in the year to December, down from 4.4% in November. England saw rents increase 3.9% to £1,424, while Wales and Northern Ireland rose 5.7%, and Scotland recorded 2.8%, its lowest annual rise in over four years.
The North East again had the highest rent inflation in England at 7.9%, while London saw the slowest growth at 2.1%, though average rents remain the highest at £2,268 per month, compared with just £762 in the North East.
PRESSURE NOT GONE AWAY
Alex Upton (main picture, inset), managing director, specialist mortgages and bridging Finance, Hampshire Trust Bank, says: “While the latest ONS data shows a slowdown in rental growth, the underlying pressure has not gone away. Demand remains strong, supply is still tight, and that imbalance continues to feed through into pricing.
“Landlords are facing a growing list of considerations. The Renters’ Rights Act, combined with tax and cost pressures confirmed in the Budget, including changes to mortgage interest relief and dividend taxation, is prompting many to take a more strategic view of their portfolios.
Some are moving into limited company structures, others are rebalancing into semi-commercial or mixed-use assets, and many are reshaping how their funding aligns with long-term plans.
“Brokers are playing a central role in this shift.”
“Brokers are playing a central role in this shift, helping landlords navigate complex changes, structure sustainable funding, and stay confident in a market that is becoming harder to predict.
“The private rented sector cannot function without adequate supply. Tenants rely on good-quality homes, but that supply depends on investors being able to operate with clarity and stability.
“If the combined effect of regulation, taxation and cost becomes too great, we risk seeing more landlords exit and availability fall further.
“For lenders, this puts the emphasis on flexibility, consistency and real-world structuring.
“Brokers need funding that reflects the dynamics of today’s market.”
“Brokers and landlords need funding that reflects the dynamics of today’s market, from portfolio restructuring and reinvestment to more complex transitions between short-term and long-term funding.
“The focus must be on enabling good deals to progress, not defaulting to rigid criteria that reduce options. In a market shaped by structural change, specialist lenders have a critical role to play in supporting tailored, long-term solutions.
“Raising standards is essential. But if we want a rental market that remains accessible and resilient, we need a regulatory and funding environment that gives landlords and brokers the confidence to stay invested.”
SLOW AND STEADY
Adrian Moloney, group lending distribution director, OSB Group, said: “Today’s data from ONS shows that as expected, house price growth remains steady but slow.
“Yet the reality for many buyers is that getting onto or up the housing ladder remains a challenge.
“There is a genuine opportunity for an affordability turning point in 2026, if lower inflation and reduced funding costs continue to feed into sharper pricing and more flexible products.
“In that environment, brokers and lenders will be central to helping borrowers
make the numbers work month to month and in ensuring that any improvement in affordability translates into people being able to buy or move.”
MARKET SET FOR A BOUNCE
Tomer Aboody, director at MT Finance, said: “With the Budget now out of the way, the uncertainty and hesitancy is also over and buyers are ready to make their move. Despite a lot of negative speculation beforehand, the Budget left the property market mostly unscathed.
“With sellers coming to the market and buyers who have delayed moves now ready to proceed, as well as lower mortgage rates, the scene looks set for a bounce.
“With the money markets expecting another base rate cut from 3.75%, although perhaps not at the February meeting of the Bank of England given the latest inflation figures, the improved affordability this will bring when it comes will encourage movement – and the market needs that encouragement.”
