Outlook for housing market in 2025 – beginning of London price growth resurgence

Rightmove predicts national average asking prices will rise by 4% in 2025. While this is Rightmove’s largest prediction for price growth since 2021, it’s in line with average long-term price growth. The Covid-influenced years of 2020, 2021 and 2022 saw larger increases in prices. One factor for this was the imbalance between supply and demand – there was a lot of pandemic-driven demand for property, while supply was constrained.

The property portal expects the number of homes for sale to remain high next year, which means strong competition will remain for sellers, and likely prevent higher price growth. However, these factors will also help agreed sales, and Rightmove anticipates a higher number of transactions in 2025 of around 1.15 million in total.

Compared with five years ago, the average asking price for a home in London is up by 12%, while for Great Britain as a whole, asking prices are up by 21%. In 2019, the price of a home in London was more than double (+101%) the Great Britain average, whereas now, the gap has reduced to 86%. The Brexit year of 2019, and the subsequent Covid-influenced years saw slower price growth for the London sales market. In 2019, average asking prices fell in London by 0.5%, compared to a 0.8% rise across the UK as a whole.

However, Rightmove anticipates that 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, helped by some major companies heading back to the office five days a week. Rightmove expects London price growth to be in line, if not marginally ahead, of national price rises.