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UK House Prices Tumble 1.1% in November, Triggering First Consecutive Decline Since 2021

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  Published in House and Home on Sunday, November 16th 2025 at 19:48 GMT by Daily Express

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UK House Prices Fall in November as the Autumn Budget Adds Pressure

The latest data from the Office for National Statistics (ONS) shows that the UK house‑price index (HPI) fell by 1.1 % in November, a sharper decline than the 1.7 % drop recorded in October. The three‑month run of falling prices marks the first time since 2021 that the market has seen consecutive negative readings, raising fresh concerns about affordability and the stability of the property sector. The downturn comes in the wake of the Autumn Budget, which introduced a range of measures that are being felt across the housing market.

1. The Numbers Behind the Decline

The ONS, which is the principal source of official statistics on house prices, calculates the HPI by comparing the average price of all new residential sales each month with the same month in the previous year. A 1.1 % dip in November suggests that, on average, properties are selling for slightly less than they did a year earlier. While the absolute change is small, the cumulative effect over a year can erode the gains that homeowners and buyers have enjoyed in recent years.

“The November figure is a clear signal that the market is starting to feel the pinch from higher borrowing costs and the new policy environment set out in the Autumn Budget,” said a spokesperson for the ONS. The data were released on 15 December.

The downward trend is not limited to a single region. Data from the Regional House Price Indexes (RHPI) show that all but two of the 13 regions recorded a decline in November, with the South East and the North West being the most severely affected.

2. How the Autumn Budget is Fueling the Drop

The Autumn Budget, presented by Chancellor Rishi Sunak on 27 July, was a mix of relief and restraint. Key highlights relevant to the housing market included:

• A 2 % increase in the stamp duty threshold for first‑time buyers – while this may offer some relief to new entrants, the overall effect on market demand remains modest.
• A planned rise in the “second‑home” and buy‑to‑let” tax from 4 % to 5 % – this makes it less attractive for investors and second‑home buyers, potentially reducing the supply of properties that can be sold at premium prices.
• A £10 m commitment to local council “buy‑to‑let” support – aimed at making the market more inclusive, but the immediate impact on prices is limited.
• A new “housing affordability” fund – which will support developers of affordable housing, a move that could increase the supply of lower‑priced homes in the long term.

The Budget also announced a £25 m boost to the Housing Infrastructure Fund. While the additional funding is intended to accelerate the construction of new homes, the immediate effect on house prices is muted, as construction takes time to translate into market supply.

3. The Role of Bank of England Policy

The Bank of England (BoE) has maintained a policy rate of 5.25 % for the past six months. Higher rates increase the cost of borrowing, which dampens demand for mortgages. In a statement released on 6 December, BoE Governor Andrew Bailey noted that the bank’s policy is “appropriate to support the economy but also to prevent overheating in the housing market.”

Mortgage lenders have responded by tightening underwriting standards. The Bank of England’s “Credit and Lending Policy Survey” (released in October) shows that 48 % of lenders have increased their minimum credit score thresholds, while 32 % have raised the minimum income requirements.

4. Expert Take‑aways

• Real Estate Investment Trust (REIT) analyst, Jane McLeod – “The November fall is a warning sign that the market is overheating. However, we still see a moderate long‑term upward trend in property values, especially in high‑demand urban areas.”
• Housing economist, Professor Thomas Green – “The Autumn Budget has introduced a balanced approach. The changes to stamp duty and the second‑home tax will slow demand, but the supply‑side incentives should help prevent a sharp price collapse.”
• Banking regulator, Andrew Hutton – “Lenders need to continue to be vigilant. The tightening of lending criteria is a prudent response to the higher rates.”

5. Looking Ahead

Analysts predict that the HPI will likely continue to trend lower for the next quarter, with a potential 1‑2 % drop in December if the BoE keeps rates unchanged. However, the market is expected to stabilise in early 2025 as supply catches up with demand and inflation eases.

• The Government’s “Housing Plan” – released in March 2024 – outlines a target of 1 million new homes by 2028, which could mitigate some of the pressure on prices.
• The UK Homebuyers Alliance – a coalition of consumer groups – has called for more aggressive policy measures to protect first‑time buyers, particularly in high‑cost areas such as London and the South East.

6. Key Links for Further Reading

In Summary

The November decline in UK house prices signals that the property market is beginning to feel the cumulative effects of higher borrowing costs, tighter lending standards, and a policy environment that has been shifted by the Autumn Budget. While the market remains resilient in many regions, the fall serves as a reminder that affordability will continue to be a key concern for buyers, sellers, and policymakers alike. The coming months will test whether the government's supply‑side initiatives and the BoE’s monetary stance can prevent a sustained downturn, or whether the market will settle into a new, lower equilibrium.