2 December 2025
If you are covering Nationwide's latest house price index, please see the following comment from Karen Noye, mortgage expert at Quilter:
Nationwide HPI shows house prices rose by around 0.3% this month, but left annual growth slightly lower at 1.8%. This reflects a market that has been treading water. Most of November was dominated by budget rumours and many buyers simply waited to see what the Chancellor would do. The confirmation of a mansion tax will matter most to the top end, but the speculation alone about what might have appeared in the budget had already stalled decisions.
With the budget out of the way, the focus now shifts back to interest rates. Inflation is easing and markets think a December rate cut is a possibility. Even if the Bank of England holds off until the new year, expectations of lower rates have already fed into swaps and lenders have started to trim fixed-rate mortgages. Any fall in borrowing costs is crucial for first time buyers who are still facing the toughest affordability conditions in years.
Former owner occupiers with more equity behind them are in a slightly stronger position, but this group also slowed activity during the budget standstill. Confidence will depend heavily on how mortgage rates behave over the next few weeks.
New build prices remain softer as developers continue to use incentives to secure sales, while existing homes have held their ground more firmly, albeit with lower transaction volumes.
Overall, this is still a market that is stable but subdued. The removal of budget uncertainty helps, but buyers will only return in greater numbers if mortgage rates continue to drift down. If inflation keeps falling and lenders sharpen pricing further, we could see activity pick up in the new year, but a rapid rebound is unlikely.
