Nationwide says UK house prices fell in December compared to November, decelerating the rate of annual growth to the lowest in 18 months. 

Prices fell 0.4% month-on-month as 2025 came to an end, taking year-on-year growth slowed from 1.8% in November to 0.6% in December – the lowest since April 2024.

The building society says part of the reason for the fall is that a year ago – in December 2024 – house price growth was unusually high at 4.7%. 

Robert Gardner, chief economist at the building society, says: “Despite the softer end to the year, the word that best describes the housing market in 2025 overall is ‘resilient’. Even though consumer sentiment was relatively subdued, with households reluctant to spend and mortgage rates around three times their post pandemic lows, mortgage approvals remained near pre-Covid levels.”

Nationwide’s quarterly house price index shows every area of the UK recording annual average increases – except for one.

The area bucking the trend is East Anglia, where prices fell by 0.8%. The building society says this was in fact the first annual decline in a region since Q2 2024, which coincidentally was also East Anglia and a fall of 0.8%.

At the other end of the spectrum, Northern Ireland continued to outpace the rest of the UK by a wide margin, with prices increasing by 9.7% over the year. This was more than five times faster than the 1.7% recorded in the UK as a whole and nearly three times higher than the 3.5% recorded in the next strongest region – the North West of England.

Despite these significant price gains, house prices in Northern Ireland are still around 5% below the all-time high recorded in 2007, while UK prices are almost 50% higher over the same period. As a result, the price of a typical home in Northern Ireland is currently around 79% of the UK average price, while in 2007 it was around 25% higher.

Scotland broadly matched the wider UK trend in 2025 with annual house price growth of 1.9%. Meanwhile, Wales saw a slight increase in annual house price growth to 3.2% and was the only other part of the UK, apart from Northern Ireland, to see stronger house price growth in 2025 than in 2024.

England saw a further slowing in annual house price growth to 1.2%, from 1.6% in Q3. 

Average prices in Northern England (comprising North, North West, Yorkshire & The Humber, East Midlands and West Midlands) were up 2.3% year on year, with the North West (which includes areas such as Cheshire, Lancashire & Greater Manchester) the top performing region in England – with prices up 3.5% year on year.

Average house price growth in Southern England (South West, Outer South East, Outer Metropolitan, London and East Anglia) was 0.6%. 

Annual price growth in London remained subdued, with prices rising by 0.7% in 2025, compared with a 2.0% rise in 2024. East Anglia was the weakest performing UK region and the only one to see an annual decline, with prices down 0.8%, compared with Q4 2024.

In response to the index, Mark Harris – chief executive of mortgage broker SPF Private Clients – says: “Hard-pressed borrowers will be hoping for January sales from lenders with lower mortgage rates as we kick off the new year – and the signs are promising.

“The trend in new mortgage pricing was downwards in December with the base-rate reduction already priced in to many new deals. Lenders are keen to attract new business and get 2026 off to a strong start.

“Market expectations are for another two or three base rate reductions this year. This will provide a welcome shot in the arm for the housing market which suffered from pre-Budget speculation over property taxes which on the whole turned out not to be as bad as many feared.”