House prices set to rise in 2025 as cost of borrowing falls - Rightmove

(Sharecast News) - House prices are set to rise by 4% next year, according to an industry forecast published on Thursday, as mortgage rates fall and demand remains strong. According to Rightmove, new seller average asking prices are likely to rise by 4% by the end of the year, as 1.15m homes change hands.

Changes to stamp duty mean the first quarter is likely to be particularly busy, as buyers rush to complete before the changes come in on 1 April.

Average mortgage rates, meanwhile, are forecast to fall to around 4%. Rightmove is basing its prediction on expectations that the Bank of England will reduce the cost of borrowing four times next year.

However, Rightmove said 2025 was set to be a buyers' market with the average number of available homes per estate agent branch the highest for this time of the year in a decade.

"While the number of buyers in the market is significantly higher that this time last year, they're often spoilt for choice," Rightmove noted.

Tim Bannister, property expert at Rightmove, said: "We expect a busier year in 2025.

"The effects of stamp duty rising will be felt for the rest of the year too, and we may see some negotiation tactics play out, particularly on properties close to the £300,000 mark, as both buyers and sellers try to mitigate their higher costs through the price agreed."

Looking across the country, Rightmove said London was likely to enjoy a stronger year. Currently, the average asking price for a home in the capital is up 12% on 2019, in contrast to the whole country, were prices have risen 21% over the same period.

However, Rightmove said 2025 "could be the beginning of the price turning point for the London market, with the fundamental pull of the capital for both workers and international buyers predicted to start to reassert itself".