Market Summary

The UK property market is entering 2025 with cautious optimism. After a challenging 2023-24, several factors point to stabilization and potential growth.

House Price Predictions

National Outlook

Most forecasters predict modest growth:

Regional Variations

Expected outperformers:

• Northern England (+4-5%)
• Scotland (+3-4%)
• Wales (+3%)

Slower growth:

• London (+1-2%)
• South East (+1-2%)

Rental Market Outlook

Demand Drivers

• Affordability constraints on buyers
• Lifestyle preferences for flexibility
• Immigration and population growth
• Student numbers rising

Rent Growth Predictions

• National average: +4-6%
• London: +3-4%
• Major regional cities: +5-7%

Interest Rate Trajectory

Base rate expected to fall:

• Q1 2025: 4.75% → 4.5%
• Q2 2025: 4.5% → 4.25%
• End 2025: Potentially 3.75-4%

Impact: Lower mortgage rates should support both buyer demand and investor returns.

Key Market Drivers

Positive Factors

1. Falling interest rates - Improving affordability
2. Strong rental demand - Supporting yields
3. Housing shortage - Structural undersupply continues
4. Employment - Labor market remains resilient

Risk Factors

1. Regulatory changes - Renters' Rights Act impact
2. Tax environment - Continued pressure on landlords
3. Economic uncertainty - Global factors
4. Building costs - Impacting new supply

Investment Opportunities

Best Performing Segments

1. Purpose-built student accommodation
2. Build-to-rent developments
3. Energy-efficient properties
4. Properties near transport links

Areas to Watch

• Manchester - Continued regeneration
• Birmingham - HS2 connectivity (eventually)
• Leeds - Financial services growth
• Bristol - Tech sector expansion

Implications for Landlords

Actions to Take

1. Review portfolio EPC ratings - Prepare for 2025 requirements
2. Lock in mortgage rates - Consider fixing while rates fall
3. Ensure full compliance - Renters' Rights Act preparation
4. Review rental pricing - Balance yield with tenant retention

Opportunities

• Purchase at current values before recovery
• Target properties with value-add potential
• Consider diversifying into different regions

Roost Market Intelligence

• Local market data - Rental comparables for your area
• Portfolio valuation - Track property values over time
• Yield analysis - Compare performance across properties
• News alerts - Stay informed on market developments