Will UK House Prices CRASH in 2025? (Facts & Figures)

📉 Will UK house prices crash in 2025? AI certainly doesn’t think so… but what does the real data say?

With falling mortgage rates, rising inflation, changing legislation, and a major landlord exodus, the UK property market is at a crossroads. So is 2025 set for a modest recovery, a slow market, or a price drop?

In this video, I break down:
✅ The 4 biggest trends shaping UK house prices in 2025
✅ The real story behind property prices (beyond the media hype)
✅ How the Stamp Duty Deadline will impact the market
✅ What mortgage rates & inflation mean for house prices
✅ Why landlords are leaving the market in record numbers

Are we heading for a crash, a recovery, or something in between? Let’s analyze the numbers so you can decide for yourself.

👇 Comment below—where do you think house prices are heading in 2025? Up, down, or sideways?

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will house prices crash in 2025 well AI certainly doesn’t think so or are we set for a modest recovery in this video I’m talking you through the latest data so that you can decide for yourself rather than just follow the clickbait news articles online because with folding interest rates folding mortgage rates but then increasing inflation changing legislation 2025 is shaped up to seem a bit bit uncertain for the UK property market so in this video I’ll break down what’s really happening and the four key trends that will Define UK house prices in 2025 into next year but in case you’re wondering why you should bother listening to me well since 2013 I’ve built a UK wide home buying company British home buyers and a nationwide estate agency British home sellers that means I’m not just analyzing data I’m I’m living and breeding it and my business is seeing these Trends firsthand from buyers sellers landlords and investors perspectives every single day the whole purpose of this channel is about me sharing with you the unique Insight we see here every day so let’s dive into those four key factors shaping house prices in 2025 the first is will house prices crash or Hold Steady none of us have a crystal ball but when trying to figure this out we want to look at multiple property market indicators rather than what most people do which is just to look at one because the news for instance loves looking at average house prices for instance so a recent article like this one with Halifax quoting the house prices have jumped to a record high but the challenge with this is the Halifax data and this is the same with Nationwide data is they’re only looking at their own mortgage approved sales and purchases it doesn’t look at any cash buying transactions for instance or any transactions from buyers using other lenders it’s only a snippet of part of the market and even if you look at the land registry data which will include all transactions including cash purchases people not using mortgages there is then a bigger lag because let’s say you complete on a purchase today that was probably agree between you and the seller months ago and then that won’t update on the land registry for another couple of months into the future before it’s then reported on so although right now it looks like ukah house prices are broadly static they’ve gone up a little in reality that is the picture from about six months ago and even if you break it down by country you can of course see there are some areas that have risen faster than others and that would be the case if you break it down further but really this is is again a lagging indicator it shows what the market was like 6 months ago not today not the future what we want to do is also look at leading indicators to get a sense of the momentum of the market moving forward from today yes of course it’s useful to know where house prices were 6 months ago from the land registry data but is the momentum positive or negative from here from today now that’s also useful to know and the earliest leading Market indicator we can look at is Right Move data which I know is not perfect it’s literally what’s on the market right now right move shares this monthly average asking price graph that shows how average asking prices have moved month by month to be clear this is showing asking prices which is the downside to looking at right move data no data set is perfect it’s not ultimately showing us sold house prices like like the land registry shows us but like we discussed earlier the land registry data is a lagging reactive measure of the market what this data shows us is at the time how are average marketing prices moving which is still a good thing to look at so we can see through early last year average asking prices were climbing then back end as we had the election and the budget and so on it starts to slide clearly this demonstrates this shows us the market was getting tougher through last year year pushing average asking prices downwards entering this year it certainly started to pick up again which is positive however this is asking price data not sold house data what percentage of properties actually sell at asking price do you think well less than you would think pairing The Right Move asking price data to this graph helps make the pitch clearer for us this shows the percentage of properties achieving asking price as well as above and below asking price so you can see that still over 70% of properties are selling below asking price compared to less than 20% selling below asking price in periods of 2022 but the percentage of properties achieving asking price although low is starting to increase from 11% to 16% it matches up to that right move data I just showed you with average asking prices beginning to rise the back end of last year as more people achieve asking prices as less people need to reduce their prices on right move before they sell more people then feel confident to Market their properties for more money and so you see the average asking prices move up you can also see in this graph the point the market started to shift from being a hot sellers Market to a buyer Market when most properties were selling at or above asking price sellers had all the control because the market was so hot now that the majority of properties are selling out below asking price buyers out there have far more choice and control so we’ve so far looked at lagging incomplete Halifax and Nationwide data lagging complete land registry data and right move data is a leading indicator so what’s this conclude while house prices aren’t crashing they’re not soaring either the next sections are going to break down things the government has done that is clearly going to skew price data short term in the future and potentially keep growth slower through this year into next let’s get into those next sections the second section the stamp Duty deadline a price surge before April stamp Duty thresholds are set to drop in April 2025 meaning after this date any buyer spending more than £125,000 for a property will pay 2% stamp Duty on any amount above1 125 up to 250 so for a £250,000 purchase that adds £2,500 on your stamp Duty bill for first time buyers they’ll currently pay no stamp Duty on purchases up to 425,000 then pay 5% on the price above that up to 625 625,000 from April this year the 0% stamp Duty limit will fall from 425,000 to 300,000 and you’d then pay 5% on anything above 300,000 up to 500,000 so it’s important to factor in how this is going to naturally create a big spike in Market activity in q1 of this year because loads of people are going to be rushing to complete by this deadline rather than complete in April May or June this graph shows how every removal of a Stam Duty benefit in the past has led to massive spikes in transactions immediately before the deadline after you then way see a sharp drop and then the market equalizes so this context is important because if we look back at this graph of right move averages right move average asking prices how much of that rush over the back end of last year where we saw average prices increase and early this year is actually really attributed to that extra volume of people pushing to buying complete pre-amp Duty change are we then going to see the back end of 2025 the back end of this year begin to slow down a lose steam in reality in Q2 we have of course are naturally going to see a slow down post stamp duty but all that land registry data that then is realized two to three months later is probably going to show how transaction volumes have increased and how house prices have increased and that will be all over the news when you and I know that that data is actually out of date it was probably because of the Boom the stamp Duty change artificially created earlier in the year that has then led to the outdated land registry data that will be in the news in the future so I hope this video is showing you how you need to keep an eye on different data points to try and Center on an accurate view of what’s actually happening today and what the direction things are heading in the future for the property Market rather than just follow what’s on the Press we’ve still got two key areas to cover that will help us better predict the direction of house prices over the rest of this year the next section is the third one mortgage rates and affordability is this the biggest Factor mortgage costs are still the biggest barrier for buyers as about 2/3 of transactions use mortgages so understanding the mortgage Market data is important to understanding the underlying health of the property Market as a whole this table shows net mortgage approvals for house prices over last year over 2024 and in case you don’t know a mortgage approval is a firm offer from A lender to provide a loan for a property and as mortgage approvals often happen weeks even months before the completion of a purchase it does give us a really good predictive indicator a leading indicator on the demand for property in the future increase in mortgage approvals generally links to an increase in demand for property the fact as you can see here it’s been increasing is clearly showing a positive upwards movement in demand especially when you look at the same data as a three-year view you can see here it is starting to get back towards the levels we saw back over 2022 when the market was in a far better place when it was far more of a sellers Market it certainly seems like we’re working our way out of the drop we saw over 2023 which was then really recovering through last year through 2024 and is now entering in a stronger place this year in 2025 and when you factor in the Bank of England recently reducing rates to and a half% in early February if that continues that should make borrowing more money more attractive to more people which helps the property Market helps asset prices overall in anything now I know inflation increasing to 3% has started to worry many people that interest rates may not drop that’s why the Press love writing those articles but it is worth bearing in mind that the bank of England themselves have forecast inflation will likely rise to 3.7% by the third quarter of this year Year by the summer before then easing so even with that expectation the bank of England is still indicating interest rates will drop through this year anyway even though they think inflation will keep Rising so the thing to watch for is if inflation heads above 3.7% Target by the summer time not that 2% Target if it does then that will mean inflation is ahead of where the bank of England themselves expect it to be and we’re in trouble if we stay below that 3.7% Target by the summer then we’re probably okay rates will probably still Edge downward slowly at the moment many forecasts still expecting Bank rates to drop a couple more times this year so dare I say it we could see rates down towards 4% by the end of the year so what’s this mean if rates drop demand may increase later in 2025 pushing prices up slightly buyers and investors should be watching for better mortgage deals in the second half of this year interest rates really matter at the moment because currently 30 % of UK adults report finding it somewhat difficult or very difficult to afford their rent or mortgage payments so lower rates not only makes it easier for people to pay more for property but it also ultimately reduces the volume of people that may become forced to sell their property but let’s explore an area of the market that the government is deliberately strangling to slow down house prices through this year in 2025 the final section the rental market and landlord sell off 40% of landlords are considering selling in 2025 that’s three times more than last year so what’s causing this well there are two key things affecting it the first thing is is things that are actively pushing landlords out the market and the next key thing is things that are keeping landlords out the market the main thing pushing landlords out the market is Labor’s Renters Rights bill is getting a lot of landlords worried and stressed rest now without taking you through the 250 page document the key things of concern are the scrapping of section 21 no fault evictions I know the government and press have labeled removing section 21 as removing no fault evictions but in reality the majority of landlords have been using it when there is a fault from the tenant so for example if a tenant stops paying rent rather than having to wait for months of rental is to build up before you can then evict you can instead just issue section 21 to start eviction proceedings there and then yes you can’t claim unpaid rent back but you can get the tenant out more quickly of course I’m also sure there are a minority of landlords abusing this and serving section 21 if a tenant refused A rent increase or complained about a legitimate issue however in the most part section 21 is used ethically the issue for ethical decent landlords with removing section 21 is yes you removing the minor it of instances ban bad landlords abuse section 21 but you’re also making the eviction process far far harder for the good landlords that we’re using section 21 ethically if you’re a tenant please do understand that this will push bad landlords out the market which is really great but it’s also going to push good landlords out the market because there aren’t protections against Bad tenants that don’t pay rent by doing this you’re throwing the baby out with the bath water when the renters bill passes to evict a tenant a landlord has to wait till a tenant is in 3 months rent are before they can even start eviction proceedings only then after three months can they then Issue four weeks notice to the tenant to leave the property if the tenant refuses to vacate the court court process to get them out could add months on top so the fear for landlords is whereas now you can get a tenant not paying rent out within a few months that could then become 6 to 12 months dependent on how efficient the court system is which right now it isn’t efficient of course the other concern is the easier the system is for tenants to abuse the concern is you’ll then have a greater proportion of tenants play the system so this is the key thing that is actively pushing landlords out the market the key thing making it harder for landlords to actively enter the market is the increase of second home stand Duty from 3% to 5% so simplistically this time last year when I bought an investment property for say £100,000 I pay an extra £3,000 of stamp Duty on on top of all other costs now this is increasing to £5,000 ultimately this isn’t going to stop all investors buying property of course not but it adds an additional Financial barrier that will reduce down the volume of transactions from investors and all of this has been working the percentage of property transactions by land Lords has dropped to 99.6% which is the lowest it has ever ever been recorded since records began 2009 it’s it’s the first time it’s gone below to 10% so what’s this mean Rental Supply May shrink has shrunk pushing rents even higher investors with a long-term view will benefit from less competition for renters expect a tighter supply of properties to rent and Rising prices unless the government intervenes with something else so what are my final thoughts of this house prices aren’t crashing but they they aren’t soaring either the stamp Duty deadline will create short-term spikes followed by a Slowdown mortgage rates will determine where prices go next landlords are selling which ironically is creating opportunity for investors mainly bigger landlords bigger commercial landlords Regional differences will be huge some areas will see price growth far higher than others Others May see stagnation or even drops so what do you think will house prices go up or down will stay the same through this year in 2025 let me know in the comments below and I’ll see you in the next video up here