The peer-to-peer real estate investment platform suggests that recent optimism in the UK property market could be well-founded.
easyMoney has analysed historic sold prices from the Gov UK House Price Index as well as mortgage-approved house prices from the Nationwide House Price Index to gain insight into recent house price trends, before forecasting expected price growth between today and the end of 2025 based on current market trends.
Recent months have seen house prices falling in the UK. The Gov UK House Price Index shows that in August 2023, the average home sold for £285,862, before falling every month through to February 2024 when the average stood at just £280,673.
This period of consistent decline spurred headlines of housing market doom and gloom in the national media, fuelled by various industry experts, such as Lloyds Bank, Rightmove and Zoopla, all warning of price drops between -1% and -4% before the end of 2024.
In November 2023, Savills joined the conversation by predicting prices would fall by -3% by December of this year. However, the estate agency giant has recently chosen to update its forecast to predict that prices will actually grow by 2.5%.
This new-found optimism in the market, which has also been mirrored by the likes of Knight Frank, is in part due to a promising uptick in Price Paid data recently published by the Land Registry.
After months of consecutive drops, the most recent UK House Price Index shows that prices climbed in March 2023, rising to an average of £282,776 compared to February's figure of £280,673.
The increasing health of the UK housing market is further demonstrated by mortgage-approved house price data from the Nationwide House Price Index which reveals how much buyers are borrowing to fund their plans to purchase. These figures preempt the Gov house price data which is based on actual sold prices and, as such, enable us to gain early insight into the changing health of the market.
Nationwide data reveals that the average house price has been rising steadily since early 2024 and, in April (the most recent data available) hit £261,962. This is the highest point since June 2023.
easyMoney’s price forecast
Based on historical market trends dating back to January 2014, easyMoney has been able to produce a house price forecast that suggests the newfound confidence is well justified.
By this time next year, easyMoney’s analysis estimates that the average house price will have increased by 3.6% to sit at an average of £292,838.
Furthermore, this impressive growth is set to continue through to the end of next year and by December 2025 will be up 6.3% versus today to sit at an average of £300,559.
Jason Ferrando, CEO of easyMoney says: “The recent doom and gloom around the UK housing market has not been unjustified, but it could be argued that lots of industry voices have been far too quick to paint negative pictures while the economic outlook has been one of uncertainty.
"Time and time again, UK property has proven itself to be resilient in the face of external pressures, and while prices may dip for a while, they rarely ever crash and always bounce back quickly.
"This is what makes property such a sound and sensible investment and a significant step away from other, more volatile assets that are far more volatile in the face of perceived socio-economic pressures.”
