UK house price growth slowed sharply at the end of 2025, with annual growth easing to 0.6% in December, down from 1.8% in November, according to Nationwide. Prices also fell 0.4% month-on-month on a seasonally adjusted basis, marking the weakest annual growth since April 2024.

Despite the softer finish, Nationwide says the housing market remained remarkably resilient through 2025. Mortgage approvals stayed close to pre-Covid levels, helped by easing affordability as earnings growth outpaced house prices and mortgage rates gradually declined. First-time buyers were particularly active, with high loan-to-value lending at its highest level for over a decade.

Regional performance continued to diverge. Northern Ireland was once again the standout performer, with prices up 9.7% over the year, far outpacing the rest of the UK. Wales also saw solid growth of 3.2%, while the North West was the strongest-performing English region at 3.5%. In contrast, East Anglia was the weakest area, recording a 0.8% annual fall – the only region to see prices decline.

London remained subdued, with annual growth of just 0.7%, reflecting longer-term underperformance compared with the rest of the UK. Flats continued to lag behind other property types, with prices down 0.9% year on year, weighed down by higher service charges, maintenance costs and weaker demand since the pandemic.

Looking ahead to 2026, Nationwide expects modest improvement, with annual house price growth forecast in the 2%–4% range, supported by improving affordability and lower interest rates. Recent Budget changes to property taxation are not expected to materially affect the sales market, though higher taxes on rental income may further constrain buy-to-let supply and keep upward pressure on rents.