The price of a typical UK house was £269,000 in January 2025 - £13,000 higher than 12 months ago.
The average UK house price annual inflation was 4.9% (provisional estimate) from 12 months to January 2025, up from the revised estimate of 4.6% in the 12 months to December 2024, according to the latest government figures released by ONS.
ONS data shows that the price of a typical UK house reached £269,000 in January 2025, a £13,000 increase on the same period last year.
Looking at the regional breakdown, average house prices in the 12 months to January 2025 increased in England to £291,000 (4.8%), increased in Wales to £210,000 (6.0%) and increased in Scotland to £187,000 (4.6%). The average house price increased in the year to Q4 (Oct to Dec) 2024 to £183,000 in Northern Ireland (9.0%).
On a non-seasonally adjusted basis, average UK house prices increased by 0.2% between December 2024 and January 2025 compared with a decrease of 0.1% in the same period 12 months ago. On a seasonally adjusted basis, average house prices in the UK increased by 0.7% between December 2024 and January 2025.
In English regions, annual house price inflation was highest in the Northeast, where prices increased by 9.1% in the 12 months to January 2025. London was the English region with the lowest annual inflation, where prices increased by 2.3% in the 12 months to January 2025.
Nathan Emerson, CEO of Propertymark, comments, “Today’s figures suggest that housing continues to play a vital role in the UK economy and that an uplift in housing activity can help generate further economic growth. With the Planning and Infrastructure Bill heading through Parliament, this should pave the way for 1.5 million new homes across England and Wales before the next general election and should contribute positively towards stabilising supply and demand levels and help keep pace with predicted population growth across the forthcoming years.
“Although the last Bank of England Money and Credit Report suggested that net mortgage approvals for house purchases decreased slightly at the start of this year, there is currently a strong appetite to borrow in order to purchase a potential new home. The same report suggested overall net borrowing rose by £0.9 billion. Today’s news should deliver a sense of confidence to those considering taking either their first or next step on the housing ladder.”
Tim Parkes, CEO of RAW Capital Partners, said, “House prices continue to report positive annual growth, and this very much aligns with the market sentiment we are witnessing on the ground. Momentum built towards the end of last year, and activity levels have surged in early 2025. Despite next week’s changes to Stamp Duty thresholds, there's still optimism that the market will continue to perform well throughout the spring and summer months.
"Regardless of what decision comes next, the sector is actively finding ways to facilitate investment, and today’s positive house price data should provide further encouragement. Lenders and brokers must now work together to ensure investors can access the finance they need to sustain this momentum into Q2 and beyond.”
Iain McKenzie, CEO of The Guild of Property Professionals, comments, “The early months of 2025 have been characterised by a surge in activity as buyers and sellers alike looked to finalise transactions ahead of the Stamp Duty changes. This has driven a notable uptick in market momentum, with buyer demand, sales agreed, and new listings all showing positive year-on-year growth.
"While we may see a period of adjustment as the market absorbs the tax increase, improving mortgage rates and continued earnings growth are providing a solid foundation for sustained price stability. The outlook remains cautiously optimistic, particularly with the potential for further government support in the Spring Budget.
"London and other high-value regions, in particular, are set to benefit from improved affordability, and we anticipate steady, modest price growth through the year. Despite ongoing economic headwinds, the housing market continues to demonstrate resilience, and we expect strong levels of sales activity to persist in 2025.”
Richard Harrison, Head of Mortgages at Atom bank, said, “The increase reported by the ONS - the highest rate of annual growth since February 2023 - is a great snapshot of the start of this year, with buyers moving quickly out of the blocks in the race to beat the upcoming Stamp Duty deadline. This is borne out by figures from Rightmove, showing that the level of agreed deals is up by 9% on the same point last year. Even if the passing of the Stamp Duty deadline leads to a material drop in demand, the underlying lack of supply means prices are unlikely to drop at all over the coming months.
“Cheaper mortgage rates are playing their part, too. Moneyfacts reported significant momentum in rate falls across February, with two and five-year fixes dropping at the fastest pace in six months. With inflation coming in lower than expected, and the markets now predicting there will be two further base rate cuts this year - potentially from as soon as May - the prospect of mortgage rates heading below 4% will buoy buyers.
“However, if lenders are to meet that demand, they will have to be flexible with borrowers who fall outside the Prime category. The challenges of the last few years mean increased numbers of would-be buyers have less than spotless credit records, yet are more than capable of meeting the monthly mortgage repayments. It’s vital that they have access to competitive mortgages, and at high LTVs, if we are to have a housing ladder that functions properly.”