Annual house price growth softened slightly to 1.8% in November, down from 2.4% in October, the Nationwide revealed this morning. However, despite the uncertainty ahead of the Budget, property prices rose by 0.3% month on month, once again showing the market’s resilience.
Nationwide Chief Economist, Robert Gardner, said: “November saw a slight softening in the rate of annual house price growth to 1.8%, from 2.4% in October. However, prices increased by 0.3% month on month, after taking account of seasonal effects.
“The housing market has remained fairly stable in recent months, with house prices rising at a modest pace and the number of mortgages approved for house purchase maintained at similar levels to those prevailing before the pandemic.
“Against a backdrop of subdued consumer confidence and signs of weakening in the labour market, this performance indicates resilience, especially since mortgage rates are more than double the level they were before Covid struck and house prices are close to all-time highs.
“The changes to property taxes announced in the Budget are unlikely to have a significant impact on the housing market. The high value council tax surcharge, which is not being introduced until April 2028, will apply to less than 1% of properties in England and around 3% in London.
“The increase in taxes on income from properties may dampen the supply of new rental properties coming onto the market. Rental supply has been constrained for some time, with the potential for this to maintain upward pressure on rental growth, which has been running at all-time highs in recent years.
“Looking forward, housing affordability is likely to improve modestly if income growth continues to outpace house price growth as we expect. Borrowing costs are also likely to moderate a little further if Bank Rate is lowered again in the coming quarters.
“This should support buyer demand, especially since household balance sheets are strong. Indeed, in aggregate, the ratio of household debt to disposable income is at its lowest for two decades.”
Property market resilience
Darryl Dhoffer, Founder at Bedford-based The Mortgage Geezer, said the housing market continues to show its resilience: “Despite high interest rates, high inflation and an economy running on fumes, the property market has shown resilience in 2025 and that continued even in the month of the Budget. The structural undersupply of property is underpinning the market and preventing prices from falling further.
“Simultaneously, pay growth remains robust, supporting affordability and keeping real incomes positive as inflation eases. Those predicting a crash in property prices have once again been proved wrong, as the market is simply adjusting to a slower pace, not collapsing. A sharp correction remains unlikely.”
Katy Eatenton, a Mortgage Specialist at St Albans-based Lifetime Wealth Management, agreed: “Countless times the property market has shown its mettle despite the economy being under pressure.
“The fact that property prices grew in a month of crippling uncertainty ahead of the Budget shows how resilient the market is. December could see a rebound in demand and we are expecting a busy January as people who put their transactions on hold ahead of the Budget enter the market in earnest.”
But Michelle Lawson, Director at Fareham-based Lawson Financial, was unimpressed by the data and said it reflects how sluggish the market has become.
She said: “2026 will need to start with an explosion of innovation to get things moving as the housing market is the pillar in so many other avenues of the economy. Let’s hope for a cut in the base rate at the next meeting of the Monetary Policy Committee.”
Justin Moy, Managing Director at Chelmsford-based EHF Mortgages, said property prices have been treading water: “Property prices and mortgages have been treading water for some time, as buyers have waited to see which rumours from Number 11 were to prove true.”
He added: “The timing of the Budget has resulted in a lost quarter for the property market. With the Budget now behind us, out come the baubles and the property market now goes into its annual slowdown for Christmas.
“Months of potential activity have been lost. We all might as well shut up shop and come back in 2026.”
Photo by Everyday basics on Unsplash
