British house prices are expected to increase by up to 3 per cent next year, as property remains in short supply across much of the country and new home construction has been weak, according to a prediction made by mortgage lender Halifax.

Amanda Bryden, the head of Halifax mortgages, explained that the uneven availability of properties for sale, in relation to demand, continues to support prices. She also noted that higher mortgage rates compared to a few years ago might have made some homeowners hesitant to sell, as it could trigger an immediate increase in their monthly mortgage costs when they move.

Last week, British Prime Minister Keir Starmer announced plans for an overhaul of the planning system, aiming to speed up the construction of new homes and boost economic growth.

Rival mortgage lender Nationwide stated that it expected house prices to rise between 2 per cent and 4 per cent in 2025.