The UK’s property market remains buoyant overall, but a rift is opening between London and the rest of the country.
The latest data indicates that while average house prices grew by 4.6% across Britain in 2024—following a 3.9% increase up to November—homes in the capital stagnated in value over the final months of the year. London finished 2024 with no annual growth, even slipping by 0.3% in November and December, while northern regions, Scotland, and Northern Ireland all logged strong annual increases thanks to better affordability and escalating rental costs that spur buyers to take the plunge.
According to Jonathan Hopper, chief executive of Garrington Property Finders, the capital’s sluggish performance partly stems from tax changes announced in October’s Budget, which dampened sentiment, especially at the higher end of the market. Many prospective purchasers are also becoming more price-sensitive, either pushing aggressively for discounts or simply choosing to look outside London altogether. These patterns stand in contrast to what’s happening further north and in devolved regions, where more affordable house prices combined with higher rents are driving people toward ownership. Buyers there range from first-timers to those relocating from pricier areas.
Hopper also points to an abundant supply of properties in certain southern markets, giving buyers the upper hand when negotiating. Mortgage lenders gradually lowering rates toward sub-4% levels only strengthens their position to secure favourable deals. This abundance of choice is expected to restrain significant price hikes in the South.
Parallel research from Home.co.uk echoes this trend, showing that high stock levels across London, the South East, and the South West have forced sellers to trim asking prices if they hope to remain competitive. Meanwhile, vendors in regions like Yorkshire and Scotland appear more confident, with Yorkshire posting a monthly price rise of 0.8%. For investors, these imbalances highlight where the best opportunities might lie: either in underperforming areas with a chance to negotiate or in northern markets enjoying consistent and rising demand.
