North West Property Leads UK House Price Growth
In the latest house price data, North West property leads the way, with the average UK home nearing £300,000. This trend has further established the region as one of the country’s prime locations for property investment. The recent House Price Index from Halifax shows a 3.3% year-end increase in UK house prices. However, December saw a slight dip of 0.2%.
This marks the conclusion of a “broadly steady” year for the UK housing market. House prices grew slowly in the first half of the year. However, the second half saw significant gains due to lower mortgage rates, stronger income growth, and rising demand.
Halifax reports the average home price in the UK is £297,166. This surpasses Nationwide’s December figure of £269,426. The difference arises from each lender’s distinct methodology in compiling its indices. Data from Rightmove and Zoopla often reflect slightly higher asking prices due to their portal nature.
Despite variations in the numbers, one theme remains consistent. The North West region continues to outperform across house price indices. Cities like Manchester and Liverpool, along with the surrounding areas of Stockport and Bolton, have been key contributors to this above-average growth, which is expected to persist.
The North West: A Hub of Growth
Halifax’s analysis indicates that the North West experienced a price increase of 5.3% over 2024, outpacing the national average by 2%. Northern Ireland saw even greater growth at 7.4%, but the North West remains a clear leader in regional house price growth. Zoopla’s latest index also highlights Manchester as a top performer among England’s major cities, a position it has maintained for several months.
Manchester: A Long-Term Property Investment Favourite
Manchester has long been a popular city for property investors, and this trend shows no sign of slowing. The city has witnessed significant regeneration projects that have revitalised the urban landscape, making it even more appealing to homebuyers and tenants alike. One of the most noteworthy developments is the city’s Bee Network, a comprehensive public transport scheme designed to improve connectivity across Manchester and the wider North West. This has contributed to the city’s increasing attractiveness, as both residents and investors seek better access to transport and amenities.
Manchester’s booming housing market has been bolstered by these improvements, which have enhanced the city’s appeal to people moving in from other regions, as well as to investors looking for long-term capital growth. With a strong job market and a rapidly growing population, the demand for housing in Manchester is expected to remain high, supporting further price increases in the years to come.
Liverpool: A City of Ongoing Redevelopment
Liverpool has also been a standout performer in the North West, with significant ongoing development on both sides of the River Mersey. This redevelopment has created new opportunities for property investors, particularly in areas that were previously underdeveloped.
The city’s cultural appeal, alongside substantial investment in infrastructure and regeneration projects, has enhanced its potential for long-term growth. Liverpool has attracted both domestic and international investors eager to capitalise on the city’s potential. Improvements to local transport and the urban environment continue to drive growth.
Demand for housing in Liverpool remains strong. With large-scale regeneration projects underway, the city will likely remain a key destination for property investors.
Ongoing Demand and Investment in the North West
Despite ongoing development and new housing projects, demand for properties in the North West still outstrips supply. This trend is expected to continue. This imbalance has driven the region’s property market. It is likely to persist, partly due to planning policy changes and increased investment.
Savills’ latest forecast suggests that the North West will see cumulative house price growth of 29.4% over the next five years, outpacing all other regions in the UK. This significant growth positions the North West as one of the best-performing areas. Property investors seeking long-term capital appreciation should focus here.
Factors Supporting the North West’s Property Market
Several key factors continue to support the North West’s property market, ensuring its status as a regional leader in house price growth. First and foremost, there is a sustained demand for housing across the region, driven by both first-time buyers and investors seeking strong returns. The supply of new homes, while improving, has yet to catch up with demand, resulting in rising prices and a competitive market.
Furthermore, the region’s robust economy, with strong performance in sectors such as technology, healthcare, and education, continues to attract new residents. Both Manchester and Liverpool are also home to major universities, which contribute to the region’s population growth and increase the demand for rental properties.
The ongoing regeneration of key areas in both cities, along with substantial infrastructure improvements, further bolsters the region’s appeal. The prospect of greater development in the coming years strengthens the North West’s property market. As a result, it will remain a sound investment.
What’s Next for the UK Property Market in 2025?
While the North West’s property market is poised for continued growth, the wider UK housing market is more difficult to predict. Several factors, such as mortgage rates and government policy, can influence the market in 2025. Broader economic conditions will also play a key role.
However, certain fundamentals will continue to support the market. There remains a chronic undersupply of homes in many areas, which will continue to drive demand. While affordability challenges remain, particularly for first-time buyers, there are signs that the market will see modest price growth as buyer demand remains strong.
Amanda Bryden, Head of Mortgages at Halifax, explained that the housing market in early 2024 was relatively steady, with house prices picking up towards the summer. Factors such as falling mortgage rates and income growth have helped ease financial pressures for many buyers, leading to an increase in mortgage demand.
Looking ahead to 2025, Bryden noted that falling mortgage rates and expected Stamp Duty changes will support demand. However, mortgage affordability could still challenge many buyers. The Bank of England’s rate decisions will also play a crucial role in shaping the market. If interest rates fall more slowly than anticipated, affordability may continue to be an issue for some buyers.
Despite these challenges, Bryden remains optimistic that demand will hold up, supported by favourable employment conditions and changes to tax policy. The housing market is expected to experience modest growth in 2025, with property prices rising steadily but not dramatically.
The Role of Government Policy in Shaping the Market
Government policies will also play a pivotal role in shaping the property market over the next few years. Potential changes to Stamp Duty thresholds aim to make property more accessible to first-time buyers. These changes could significantly impact demand. Changes to housing supply policies, like easing planning restrictions, could help alleviate supply-side constraints. Additionally, increased funding for new developments could support this.
As we look to 2025, the property market in the North West remains strong. Cities like Manchester and Liverpool will continue to lead the way. Ongoing regeneration projects and high demand make the North West a top choice for property investors. Strong growth prospects continue to attract capital appreciation.
Conclusion: The North West’s Continued Property Dominance
As the UK housing market navigates a period of uncertainty, the North West stands out as a clear leader in property price growth. Cities like Manchester and Liverpool are driving the region’s success. As a result, housing demand will remain strong, supported by investment and regeneration.
Property investors seeking solid returns should watch the North West closely. The region’s future growth prospects are among the best in the UK. House prices are forecasted to increase significantly over the next five years. As a result, the North West remains highly attractive to both first-time buyers and investors.
