As 2024 concludes, the UK property market has witnessed dynamic shifts, offering critical insights for landlords planning their next moves. The Halifax House Price Index for December 2024 reveals significant trends shaping property investments and rental yields. Here’s what you need to know as a landlord navigating this evolving market.
The Landlord Insurance team here at Lansdown have summarised the significant changes and what they mean for property owners.
Annual Growth and House Prices
The average UK property price reached £297,166, reflecting an annual growth of +3.3%, despite a slight -0.2% dip in December. This growth trajectory has been driven by reduced mortgage rates and rising incomes, providing landlords with opportunities for increased equity and long-term gains.
Regional Highlights
Northern Ireland led the charge with a +7.4% annual increase, bringing average property prices to £205,895. Wales also performed strongly with a +4.6% rise, while England’s North West saw growth of +5.3%, outpacing London’s +3.3%. These figures highlight diverse opportunities across the UK, with some regions offering better value and rental yields.
Factors Driving the Market
- Falling Mortgage Rates: A steady decline in mortgage rates has alleviated financial pressures, stimulating demand and driving property price growth.
- Stamp Duty Changes: Impending adjustments to Stamp Duty thresholds encouraged many first-time buyers to accelerate purchases, intensifying competition in key markets.
- Supply Constraints: Demand continues to outstrip supply in many regions, with homeowners hesitating to list properties, anticipating further rate reductions.
Looking Ahead to 2025
While the market benefited from these factors in 2024, challenges remain:
- Mortgage Affordability: The Bank Rate is expected to decline gradually, maintaining a strain on affordability for buyers and investors
- Employment Conditions: Stability in employment levels will be crucial to sustaining buyer demand and market momentum
For landlords, 2025 offers a mixed bag. Rental demand is likely to remain robust as affordability pressures deter potential homeowners. However, the challenge lies in balancing investment costs with competitive rental pricing.
About Lansdown Insurance Brokers
Lansdown Insurance Brokers are specialists in Landlord Insurance and Block of Flats Insurance. We can provide flexible policies to suit individual client needs. Whether you’re a landlord, letting agent, or property owner call the team on 01242 524498 or email enquiries@lansdowninsurance.com.
Lansdown is part of the Benefact Group, a charity-owned, international family of financial services companies that gives all available profits to charity and good causes.