UK house price growth rises 5% as rental demand falls

UK house price growth rose again in November, gaining momentum for the fourth consecutive month.

According to the latest data from the Royal Institution of Chartered Surveyors (RICS) residential survey, buyer demand also saw an upward trend despite higher mortgage interest rates.

The survey’s national house price indicator rose 5% during the month, up from 16% in October. This marks the fourth consecutive monthly increase, confirming upward trajectory of house price growth seen since the summer.

Respondents expect house prices to continue rising over the next three and 12 months, reflecting a robust outlook for the year ahead, RICS said.

New buyer enquiries maintained positive momentum at 12%, largely unchanged from the previous month, while 19% of professionals predict an increase in sales activity over the next quarter.

However, market appraisals in November were on par with levels recorded a year ago, possibly signalling a potential slowdown in the pipeline of new listings moving into 2025.

Tenant demand also declined slightly in November, marking the first decrease recorded since 2020. Just 1% of professionals saw rental sector demand fall, which may point to seasonal factors.

Read more: UK rents jump by more than £3,000 in three years

Tarrant Parsons, RICS senior economist, said: “Although the latest survey results continue to signal a steady improvement in buyer demand across the residential market, the broader macro environment is likely to pose additional headwinds moving forward.

“Most significantly, the recent rise in mortgage interest rates may curtail the recovery in market activity before long, and this is reflected in the slightly less optimistic sales expectations data coming through this month.

“Moreover, measures of consumer and business confidence across the economy have deteriorated of late and, if sustained, this could begin to feed through into housing market conditions in the months ahead”.

The data came as Rightmove (RMV.L) predicted the average property value on a UK home will increase by 4% by the end of 2025.

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