Largest January Jump in House prices since 2020 - Rightmove

According to Rightmove, January 2025 saw the largest monthly jump in prices since 2020. Asking prices bounced back from the typical low season of December and began 2025 with some much needed confidence!

The average price of property coming to the market for sale has risen by 1.7% this month to circa £366,189.

Average asking prices are still less than the peak we saw in May 2024, this is most likely due to high interest rates affecting buyer affordability. However, boxing day (busiest one recorded yet) saw a record number of new buyers and sellers coming to market.

The number of buyers enquiring on properties for sale since Boxing Day is 9% ahead, compared to last year, and the number of sales agreed over the same period is also up by 11% again compared to last year. Further data from Rightmove suggests they also recorded their busiest start to a year for Mortgage In Principle applications, suggesting those buyers who were sitting on the fence are starting to make their moves. This can also mean sellers will face increased competition to attract those new buyers, hence the market will likely become more price conscious.

Colleen Babcock from Rightmove states that "new sellers have started the year with a bang, with a record number coming to market not only on Boxing Day itself but across the start of the year to date. We’ve also seen a strong start to the year in new seller asking prices, though given the higher-than-anticipated seller competition, we would expect this to slow down over the next few months..."

She went on to say, "it’s encouraging to see so many sellers with the confidence to come to market, providing buyers with fresh choices. 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.”

As mentioned in a previous blog, the the market has seen increased activity in new listing and new buyer registration since 26th December, Boxing Day, being the busiest one yet according to Rightmove's data.

The combination of wider choice coupled with increased in buyer demand kept the sales market buoyant, with the number of sales being agreed between buyers and sellers higher than this time last year. Rightmove has also 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, which shows buyers are now starting to commit.

Rightmove is forecasting larger number of transactions of 1.15 million, and an average asking price increase of +4%, in 2025. Let's see how this pans out as the months go on.

Whilst we welcome all the positive start to the year we should, without sounding like a pessimist, also remain level headed. We are yet to learn about the Bank of England's intentions for this year regarding interest rate cuts - how many will we see and how often can we expect to see a cut being made in 2025?

Rightmove’s mortgage tracker shows that the average five-year fixed mortgage rate is currently 4.75% as opposed to 4.78% at this time last year. This is also reflected in the swap rates our mortgage broker update us on every week.

There have been mixed messages on how many Bank Rate cuts to expect this year, which naturally causes uncertainty and will price out some First Time Buyers (FTB) from getting on the ladder. To over come this FTB need to make the most of any help they are given like Help to Buy Isa but more importantly the freeze on Stamp Duty Thresholds which comes to and end in 3 months time. Hopefully we will see a slight cut in rates within this time which will help continue momentum in the sales market.

Rightmove's mortgage expert, Matt Smith, said, “The message around how many Bank Rate cuts we should expect this year keeps changing, creating some uncertainty for movers. News of high government borrowing costs was swiftly followed by better-than-expected inflation figures, highlighting how quickly the mood can change. The markets are still banking on a cut in February, but after that it becomes uncertain. I think we’ll need to get settled into the year a little more before the direction of travel for rates this year becomes clearer."

In conclusion we have had a great start to the year but what happens from February onwards, especially with the stamp duty threshold deadline ending end of March, the message seems to be approach with some caution before getting too excited.