London house prices did not grow at all in 2025, with the average £661,000 recorded in December the same as at the end of last year.
Nationally, asking prices fell by 0.6 per cent over the course of 2025, according to the latest data from Rightmove.
But within this overall figure there was some slight variation with a few London boroughs recording annual house price increases, and other recording falls.
The boroughs that saw the highest percentage rises in prices were mostly concentrated in east London, with Havering topping the chart.
Hornchurch in Havering where house prices have risen most in 2025
Daniel Lynch
The outer London borough saw a 4.7 per cent rise in the average asking price over the course of 2025 to £498,000.
The four top boroughs were all in east London, with Tower Hamlets (up 4.1 per cent), Hackney (up 2.9 per cent), and Waltham Forest (up 2 per cent) also high on the list.
However, more London boroughs saw average asking prices fall than rise.
The pricey inner London borough of Westminster saw the biggest drop, down 7.9 per cent to £1.35 million.
Houses in Westminster, where house prices fell the most this year
Daniel Lynch
Camden prices also fell by 3.5 per cent to £1.02 million, while in Newham in east London they fell by 3.4 per cent to £459,000.
Borough by borough: how have local house prices fared in 2025?
Across the nation as a whole, price growth was strongest in the North West of England with a 2.6 per cent jump, compared with a 2.7 per cent drop in the South West.
Rightmove analysts said that uncertainty and “gloom” caused by rumors of property tax rises in November’s budget had contributed to a slowdown of the market in the second half of the year.
The number of new sellers putting their homes on the market in the first half of 2025 was 9 per cent higher than in the first half of 2024. In the second half of the year, however, this reversed to 4 per cent below 2024 figures.
Similarly, buyer demand was 3 per cent ahead of 2024 across the first half of the year, but 6 per cent behind in the second half.
The overall number of sales agreed in the UK has still risen by 3 per cent year on year, however.
“The weeks of speculation leading up to the Autumn Budget certainly cooled the property market, especially for those making discretionary moves,” Claire Reynolds, UK Head of Sales at Strutt & Parker, said.
“However, the mood shifted almost instantly once the day finally arrived, with some evidence of a ‘Budget bounce’ in the past couple of weeks.”
Rightmove’s predicted a 2 per cent projected price rise thanks to improved affordability and plenty of choice.
The average two-year fixed mortgage rate is now 4.33 per cent, compared to 5.08 per cent average last year. This drop, paired with dropping prices and rising average wages suggests more movement in the market.
“With market conditions supporting higher levels of activity, and a hopefully more certain economic environment, we forecast a better year for price growth in 2026 with a strong rebound in activity to kick start the year,” said Rightmove’s Colleen Babcock.
“However, with buyer choice remaining high, sellers will still need to come to the market at tempting prices to attract attention and do all that they can to ensure that their property is presented as well as possible.”