The Halifax House Price for December 2025 reveals a subdued end to the year for the UK housing market, with average property prices dipping by -0.6% compared to November. This marks a sharper decline than the -0.1% fall recorded the previous month.
Key market highlights:
- Average house price: £297,755, the lowest level since June 2025
- Monthly change: -0.6%
- Annual change: +0.3%, decrease from +0.6% in November
- Regional standouts: Northern Ireland continue to perform the strongest with 7.5%, average cost of typical home is now £221,062
Amanda Bryden, Head of Mortgages at Halifax, commented:
“While this may feel like a subdued close to the housing market in 2025, overall activity levels were resilient over the last year and broadly in line with the pre-pandemic average.”
Why did prices fall?
December’s dip is likely linked to uncertainty in the latter part of the year. However, Halifax notes that this trend should start to unwind as we move into 2026. Mortgage rates are already easing following the latest Base Rate cut, and more lending options are emerging for those borrowing at higher loan-to-value ratios.
Affordability pressures remain, but there’s a silver lining: the house price-to-income ratio hit its lowest point in over a decade in December, offering hope for first-time buyers.
What’s ahead of us in 2026?
Halifax forecasts a modest rise in house prices of between 1% and 3% during 2026. While affordability remains a challenge, easing mortgage rates and improved lending options could support buyer confidence. That said, headwinds such as slowing wage inflation and flattening employment rates may temper growth.
The next House Price Index is scheduled to release on 8th January 2026.
