Nationwide: Annual house price growth slows to lowest level in almost two years

Annual house price growth almost ground to a halt in 2025, although the market remained ‘resilient’ despite higher mortgage costs, according to Nationwide.

UK property prices rose by just 0.6% in the 12 months to December 2025, the major lender said, with the average home valued at £271,068.

The modest rise is the slowest in annual house prices since April 2024, Nationwide said.

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Average house prices also slumped by 0.4% month on month, falling from £272,998 in November.

In the 12 months to December, average house prices grew in all UK regions apart from East Anglia where they fell by 0.8%. Prices in Northern Ireland increased by 9.7%.

Robert Gardner, chief economist at Nationwide, said the housing market remained ‘resilient’ in 2025 despite slowing at the end of the year.

“Even though consumer sentiment was relatively subdued, with households reluctant to spend and mortgage rates around three times their post pandemic lows, mortgage approvals remained near pre-Covid levels,” Gardner added.

Gardner said changes to stamp duty thresholds in April created volatility throughout the spring and summer as activity spiked in March, but demand ‘held up well’ across 2025.

We look at which house price index is the best in another article.

Where did UK house prices rise the most and least?

Although the overall picture showed modest house price growth in the 12 months to December 2025, some regions saw sharp increases in property values, Nationwide said.

Prices in Northern Ireland went up by 9.7%, outpacing the rest of the UK considerably. The average cost of a property there was £216,919.

The north west of England saw house price growth of 3.5% with the average property value standing at £225,665 in December.

House prices in London, south west England and outer south east England recorded more modest growth of 0.7%, 0.5% and 0.1%, respectively. The average cost of a property in the three regions was £529,372, £308,228 and £336,561.

East Anglia was the only region where house prices fell, experiencing a 0.8% drop (£269,912). This was the first regional annual decline since the second quarter of 2024, Nationwide said, when East Anglia house prices fell by 0.8%.

Credit: Nationwide

Flat prices continue to lag

Annual flat price growth continued its negative trend, Nationwide said. The property type recorded a year-on-year decline of 0.9% in the 12 months to December.

Conversely, semi-detached, detached and terraced properties recorded annual growth of 2.4%, 2.2% and 1.8%.

Over the last 10 years, the price of a typical flat has increased by 18%, less than half the 41% experienced by terraced houses. Nationwide said this is in part due to London holding a greater proportion of flats, a region which has seen slower property price growth over the past decade.

Gardner said: “The underperformance of flats (and London more generally) may in part be a function of the change in demand seen during the pandemic.

“This resulted in a shift in preferences towards properties that offered more space, which has only partially unwound.

“In addition, the increased costs of maintenance, ground rents and service charges are also likely to have impacted buyer sentiment towards flats in recent years.”