Predicted Hotspots for UK Property Price Increases in 2025

Based on the UK economy growing for the first time in three months by 0.1%, the case is beginning to be made around the Bank of England lowering interest rates in February. Constitutive with this discourse is the trajectory of property prices across the UK. Fortunately, there is a general optimism that national property prices will steadily increase throughout the year, with Colleen Babcock, property expert at Rightmove, describing January as starting the new year with a ‘bang.’

Pinpointing how regional property prices will unfold over the coming year will supply buyers, landlords, and property agencies with crucial information to assist in the decision-making process for acquiring property.

What Does the Data Show?

As of January 2025, the average property price entering the UK market is £366,189, up by 1.7% from the previous month. In many respects, this initial figure encapsulates the general trend of the UK towards growth. According to the IMF, the UK is projected to have the third largest GDP growth in the G7 this year at 1.6%, up by 0.7% from 2024.

Driven by easing financial conditions, lower inflation, and strong wage growth, the overall economic landscape supports the increased activity in the property market. Over the past year, the number of properties entering the market increased by 11%; so too has the number of sales agreed between buyers and sellers between Boxing Day and January by 11%.

Because of these increases in listings and sales, the latest RICS survey shows estate agents expressing positivity regarding the future of the property market. A net balance of 37% predicts sales rising over the next year, and a net balance of 53% believes that property prices will climb higher over the same period.

Given that these metrics have seen respectable upticks, the forecasts conducted by Capital Economics, Nationwide, Hometrack, Halifax, Rightmove, Jones Lang LaSalle, Savills, Chestertons, and Knight Frank project the average property price to increase between 2% to 4% in 2025.

On a macro level, therefore, the property market is moving in the right direction – a direction which will encourage investment due to healthy increases in market activity and property growth.

Which Locations Show the Best Price Growth?

It has been underscored that the property market is undergoing a period of growth. Yet the most recent data provided by Zoopla offers invaluable data concerning the performance of each regional property market. Such data was collected across the UK using property sales, the number of properties available on the market, and the extent to which the negotiation process resulted in lowering the initial property asking prices.

In terms of the biggest projected annual increase in property prices, Zoopla identifies the following five areas: Wigan by 5.0% (£169,846), Oldham by 4.3% (£178,401), Durham by 3.9% (£141,831), Motherwell by 3.8% (£129,055), and Falkirk by 3.5% (£164,106). On average, the biggest projected increases are going to happen in Scotland and the North West – regions also ranked highly in terms of sale completion dates and overall property stock.

On the contrary, London is projected to either stagnate or decline in terms of property price trajectories. Focusing on the following areas as case examples, property price growth is expected to increase in North West London by 0.1% (£635,416) and South West London by 1.1% (£705,705). Meanwhile, East Central London is expected to decline by –2.7% (£705,705).

Richard Donnell, executive director at Zoopla, provides a useful summary of this data: ‘we expect average UK house prices to increase by 2.5 per cent in 2025. Our analysis of key local market indicators reveals the areas where there is scope for increased numbers of home moves and house prices to increase at an above-average rate over 2025. While the outlook is best in Scotland and Northern England, there is a spread right across the UK reflecting the demand for and affordability of homes.’

What to Expect for the Property Market?

Growth is the central theme underpinning the property market in 2025. Its reach is projected to be felt in most parts of the country. As long as market conditions continue to remain stable, those looking to acquire property are participating in an opportune time relative to previous years.

Yet it is also worth noting that there are other variables, namely inflation and interest rates, which will play decisive roles in either accelerating or constraining the trajectories of property prices for this year. 

Such variables are hotly contested subjects among industry experts. But with inflation rates slowly dropping and the economy on course for significant growth, Ruth Gregory, deputy chief UK economist at Capital Economics, outlines that these conditions strengthen the case for interest rate cuts in February from 4.75% to 4.5%. 

Taking these factors into account, it is a good time for property investment. And as the Zoopla data shows, there are several hotspots across the country – in particular Scotland and the North West – which offer enticing opportunities for property acquisition.

Property Market

Cash Buyers Reap Significant Discounts in Mortgage-Free Deals

The most recent data analysis conducted by MPowered Mortgages has highlighted the several distinct advantages of cash buying a property. Not only is it more cost-effective to acquire a property, but there are also several benefits that enable the buyer to extract more favourable terms during the negotiation process.  Given the highly competitive nature of...
READ POST

© PIC Searches, Property Information Company Ltd 2018 – 2025. All Rights Reserved.
Registered in England and Wales – Company No: 09778810. Langley House, Park Road, East Finchley, London N2 8EY.

Web Design by Yellowball