Rightmove House Price Index: Record number of sellers in promising start to 2025, but uncertainties ahead
- The average price of property coming to market rises by 1.7% (+£5,992) this month to £366,189, the largest jump in prices at the start of the year since 2020:
- New seller asking prices are still nearly £9,000 below May 2024’s record, reflecting buyer affordability constraints
- A record number of early-bird new sellers have come to market since Boxing Day, giving buyers the highest level of choice at the start of a year since 2015, which has also contributed to an encouraging start to 2025 buyer activity:
- The number of new properties coming to market is 11% ahead of the same start-of-the-year period last year
- The number of buyers contacting agents about properties for sale since Boxing Day is 9% ahead of last year, and the number of sales being agreed over the same period is up by 11%
- Rightmove has recorded its busiest start to a year for Mortgage In Principle applications, evidence of buyer intent
- However, despite the promising start to 2025 there are uncertainties ahead, including the pace and number of interest rate drops and the impact of the stamp duty deadline on 31st March
- Mortgage rates remain sticky, blocking many buyers from significant affordability improvements:
- Rightmove’s weekly mortgager tracker shows that the average five-year fixed mortgage rate is now 4.75% compared with 4.78% at this time last year
The average price of property coming to the market for sale rises by 1.7% this month (+£5,992) to £366,189. This is the largest monthly jump in prices at the start of the year since 2020, as new seller asking prices bounce back from the usual seasonal fall in December and begin 2025 with some new year optimism. Average asking prices are still £8,942 below May 2024’s peak, reflecting buyer affordability constraints. However, with a record number of early-bird new sellers coming to market from Boxing Day and into January, there seems to be pent-up demand to move. The number of new properties coming to market is 11% ahead of the same period at the start of last year, while the average number of homes for sale per estate agency branch is currently at the highest for this time of year in 10 years. High buyer choice has contributed to increases in buyer enquiries and sales agreed compared to a year ago, but also means fierce seller competition to attract these new year buyers. Some sellers may find that they have been too optimistic on their initial pricing and get left on the shelf in favour of more competitively priced neighbours.
“New sellers have started the year with a bang, with a record number coming to market not only on Boxing Day itself, but across the start of the year to date. We’ve also seen a strong start to the year in new seller asking prices, though given the higher-than-anticipated seller competition, we would expect this to slow down over the next few months. The record number of sellers we’re seeing is a double-edged sword. It’s encouraging to see so many sellers with the confidence to come to market, providing buyers with fresh choice. However, with lots of homes for buyers to consider, sellers will need to work even harder to stand out from the crowd and attract a buyer. This could be with a tempting asking price, standout home features, immaculate presentation of the home, or a combination of all of these. It’s vital that in a competitive market, sellers take on the recommendations of their agent, particularly when it comes to setting a realistic price.”
Colleen Babcock, property expert at Rightmove
Buyer activity is also starting the year encouragingly, as many festivity-distracted buyers return to make their move happen. Since Boxing Day, the number of buyers contacting estate agents about homes for sale is up by 9% on the same period last year. The combination of good choice and healthy buyer demand has kept the sales trend positive, with the number of sales being agreed between buyers and sellers now 11% ahead of this time last year. Rightmove has also recorded its busiest start to a year for prospective home-movers applying for a Mortgage in Principle to understand what they may be able to borrow from a lender, which is evidence of future buyer intent. All of these very early lead indicators at the start of this year point to a busier 2025. Rightmove forecasts a larger number of transactions this year of 1.15 million, and an average asking price increase of +4%.
However, despite many positive activity metrics when compared with last year, there are uncertainties ahead, including the pace and number of future interest rate drops and the impact of increased stamp duty for many home-movers from 1st April. One market sector that Rightmove anticipates will be particularly affected is the smaller-homes, typical first-time-buyer sector. Since Boxing Day, the number of enquirers in this sector is up by 8%, the lowest increase of all market sectors. First-time buyers in cheaper parts of England will largely be unaffected. However, stamp duty charges rising for those buying above £300,000 will be a drag on the important bottom-of-the-ladder market in more expensive areas, unless some additional help for first-time buyers is announced soon.
Mortgage rates remain at unexpectedly high levels, which means that many buyers are not seeing significant affordability improvements. Rightmove’s weekly mortgage tracker shows that the average five-year fixed mortgage rate is now 4.75% compared with 4.78% at this time last year. While the average two-year fixed mortgage rate has improved, it is still 4.97%, down only slightly on last year’s 5.08%. There have been changing messages on how many Bank Rate cuts to expect this year, which are causing some uncertainty and will prevent some potential buyers from joining in the new year enthusiasm.
“It’s important to look at the bigger market picture, despite the positive early lead indicators that we’re seeing. Many buyers are still affordability-stretched, with high mortgage rates restricting borrowing power and limiting what they can afford to pay. Meanwhile, first-time buyers have seen support schemes reduce and some also face higher stamp duty fees from April, all while contending with record rents and trying to save up for a deposit. Rightmove’s early-year snapshot shows a promising start to 2025. However, the market needs a boost for that momentum to be sustained, in the form of early and ongoing Bank Rate cuts, which should hopefully help to reduce mortgage rates. Some further support for first-time buyers would also be welcomed, particularly in more expensive areas of the country.”
Colleen Babcock, property expert at Rightmove
“The message around how many Bank Rate cuts we should expect this year keeps changing, creating some uncertainty for movers. News of high government borrowing costs was swiftly followed by better-than-expected inflation figures, highlighting how quickly the mood can change. The markets are still banking on a cut in February, but after that it becomes uncertain. I think we’ll need to get settled into the year a little more before the direction of travel for rates this year becomes clearer.”
Matt Smith, mortgage expert at Rightmove
“As we step into 2025, the housing market is already showing signs of robust activity, with demand from buyers increasing year on year. This growth is fuelled by a combination of economic stability, renewed consumer confidence, and slightly more favourable lending conditions.
“The supply side of the market is also showing encouraging trends, with a good level of new instructions coming onto the market for sale. Sellers are responding to the strong buyer demand and stable property prices, taking advantage of an opportune moment to list their homes. This healthy balance between supply and demand is fostering a dynamic marketplace, benefiting both buyers and sellers. If mortgages rates reduce notably, it could be a positive year ahead.”
Peter Lawrence, Founder at Lawrence Rand in Ruislip
“We have high hopes for a strong year in 2025, with a larger pipeline of sales compared with the start of last year. We expect a solid first three months in exchanges and completions. After the cold snap we’ve just had, viewings, offers and sales being agreed are picking up again at a solid rate.
“Sellers seem to be listening to our valuation recommendations more than previously, I think this down to expectations being more realistic, and an understanding that mortgage costs are now much higher. Lending is still a challenge with uncertainty in interest rates, but there is still hope mortgage rates will come down. This is causing some buyers to hesitate, hoping they will get a better deal.
All in all, we expect a better year than 2024, but know that challenges are still ahead, with a lot riding on the government and Bank of England being consistent in their approach.”
Jordan Halstead, CEO at Jordan & Halstead Estate Agents in Chester
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