The latest Halifax House Price Index reveals a period of subdued house price growth, with year-on-year changes showing modest adjustments. According to the data, the housing market experienced reduced activity in December, as both buyers and sellers were less motivated amid the holiday season. However, there has been a noticeable shift after Christmas, with an uptick in online searches from prospective buyers and a significant surge in sellers listing their properties, particularly around Boxing Day.
Industry experts and professionals have shared their views.
Karen Noye, mortgage expert at Quilter comments:
“The end of the year often leaves the housing market short on urgency, and December was no exception. With many households having already mentally parked moving plans, the late timing of the budget added a further reason for buyers and sellers to pause, leaving activity limited as attention shifted towards the New Year rather than pushing ahead before Christmas.
Against that backdrop, Halifax’s figures showing prices falling by 0.6% over the month point to a market that was subdued rather than fundamentally weakening.
On an annual basis, prices are just 0.3% higher than a year ago, reinforcing the sense that values have largely moved sideways over the past year. While demand has been cautious, constrained supply continues to limit the scope for any meaningful price correction.
A slower-moving market has important implications for mortgage pricing. With fewer borrowers coming through the door, lenders are likely to compete more aggressively for business, particularly among lower-risk borrowers. That competitive pressure should help keep mortgage rates edging lower over time, even if any improvements are gradual rather than dramatic.
For remortgagers, this shift is especially important. While many households are still facing higher repayments than a few years ago, increased competition should reduce the risk of the sharp payment shocks that have weighed on confidence.
As we move further into 2026, greater clarity following the budget and on the direction of interest rates may encourage some of the decisions that were delayed at the end of last year to begin feeding back into the market, supporting a modest pick-up in activity rather than a sudden rebound.”
Amanda Bryden, Head of Mortgages, Halifax, said:
“Average house prices fell by -0.6% in December, down £1,789 compared to November, with a typical property now costing £297,755, the lowest since June 2025. On an annual basis, growth slowed to +0.3%, down from +0.6% in November.
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.
Various forces are poised to somewhat buoy the market heading into 2026. While December’s monthly fall in prices was likely related to uncertainty in the latter part of the year, this should now be starting to unwind. Further, mortgage rates are already reducing following the latest Base Rate cut and there are an increasing number of lending options available for those borrowing at a higher loan-to-value.
While affordability pressures persist, the house price to income ratio was at its lowest in over a decade in December, striking a positive note for those looking to purchase their first home.
On this basis, and recognising the headwinds that may affect buying power – such as the slowing of wage inflation and flattening employment rates – we expect a modest rise in house prices during the year of between 1% and 3%.”
Nathan Emerson, CEO of Propertymark, comments:
“A modest fall in house prices highlights that affordability pressures are still weighing on the market, despite recent improvements in mortgage rates. Overall, there is still a sense of consumer caution lingering within the marketplace, mostly in respect of wider economic considerations, such as the rate of inflation and how this directly impacts affordability for many.
“While price softening may help some buyers, especially first-time buyers, a sustainable recovery will depend on further rate stability, income growth, and addressing the chronic undersupply of homes.”
James Nightingall, founder of HomeFinder AI, says:
“December’s house price growth was mostly subdued amid reduced buyer and seller motivation. After Christmas, however, buyers started carrying out more online searches whilst sellers chose this period, and particularly Boxing Day, to put their property on the market. This uplift in buyer and seller activity has continued into the new year, resulting in a busy and more competitive January market.”
Hamza Behzad, Business Development Director, Finova says:
“With the Budget behind us, the housing market naturally entered a period of adjustment with prices cooling in December. After months of uncertainty, buyers who had been sitting on the sidelines still look ready to act, setting the stage for a release of pent-up demand in the new year. The recent base rate cut will also offer some welcome relief, and January could prove busier than the market would typically expect.
Affordability pressures haven’t disappeared, but the direction of travel is far more positive. Strong wage growth, easing interest rates and broader lender criteria are widening access to home ownership. Expected rate cuts should only accelerate that trend this year.
As the number of complex borrowers continues to grow, from self-employed professionals to gig workers, lenders and brokers need to work closely together to provide tailored products that suit their needs. Smarter advice and targeted support will be critical to ensuring they benefit as market conditions improve.”
Director of Benham and Reeves, Marc von Grundherr, commented:
“A monthly drop in house prices during December may seem like the proverbial lump of coal, but it is simply a case of seasonality and the underlying feeling currently pulsing through the market is one of optimism.
With the political uncertainty of the Budget having now evaporated and interest rates trending downwards, the nation’s buyers are re-entering the market with renewed vigour, and the outlook for 2026 is a positive one.”
Verona Frankish, CEO of Yopa, commented:
“A marginal monthly dip in December is not unusual and largely reflects the seasonal slowdown that comes with the Christmas period, when both buyers and sellers tend to pause their plans.
Importantly, the backdrop has improved considerably. With Autumn Budget uncertainty now behind us and interest rates falling just before Christmas, buyer confidence has strengthened, and we are already seeing a notable uplift in market activity. This renewed momentum should provide support for house prices as we move through 2026.”
