'Promising' start to the year for buyers and sellers

The UK property market made a promising start to 2025, with a significant increase in the number of buyers and sellers as confidence continued to grow.

Asking prices are also rising, with the biggest jump in prices at the start of the year since 2020.

Confidence to come to market

A record number of new sellers were seen from Boxing Day and into January, according to the latest data from property website Rightmove.

The number of new properties being listed was 11% ahead of the same period at the start of last year, and the average number of homes for sale per estate agency branch is currently at the highest for this time of year in 10 years.

With a wider range of properties to choose from, buyer enquiries and sales agreed have increased compared to a year ago. And in an indicator of future buyer intent, Rightmove recorded its busiest start to a year for prospective home-movers applying for a Mortgage in Principle to understand what they may be able to borrow from a lender.

Asking prices are up 1.7% on average this month, bouncing back from the usual seasonal fall in December to register the largest new year increase since 2020.

Competition among sellers is expected to rein in prices over the next few months.

"It's encouraging to see so many sellers with the confidence to come to market, providing buyers with fresh choice," said Colleen Babcock, property expert at Rightmove. "However, with lots of homes for buyers to consider, sellers will need to work even harder to stand out from the crowd and attract a buyer. This could be with a tempting asking price, standout home features, immaculate presentation of the home, or a combination of all of these. It's vital that in a competitive market, sellers take on the recommendations of their agent, particularly when it comes to setting a realistic price."

Regional breakdown

Looking at regional housing markets across the UK, property website Zoopla found that Scotland and Northern England have the strongest prospects for house price growth in 2025, as Southern England continues to adjust to the impact of high mortgage rates.

In England, the strongest markets are led by Newcastle, closely followed by Leeds, Stoke-on-Trent, Wigan and Carlisle. Prices are also rising fast in Northern Ireland.

Support for first-time buyers

Although the early lead indicators are positive, high mortgage rates are still restricting buyers' borrowing power and limiting what they can afford to pay, Colleen Babcock warned.

Meanwhile, first-time buyers are facing a reduction in support schemes and higher stamp duty fees from April, all while paying out record-high rent and trying to save up for a deposit.

And there are uncertainties on the horizon, including the timing and size of future interest rate cuts and the impact of increased stamp duty for many home-movers.

"Rightmove's early-year snapshot shows a promising start to 2025," Babcock said. "However, the market needs a boost for that momentum to be sustained, in the form of early and ongoing Bank Rate cuts, which should hopefully help to reduce mortgage rates. Some further support for first-time buyers would also be welcomed, particularly in more expensive areas of the country."