Increase in house prices signifies a new era for Wales
Welsh Housing Market Shows Steady Growth and Recovery
In a recent report by the Principality Building Society, the Welsh housing market is showing signs of steady growth and recovery, according to their House Price Index. The average house price in Wales has stabilized around £238,098, marking a slight 0.7% year-on-year increase and remaining only 4.6% below the 2022 peak.
Housing transactions have surged above 10,000 in Q2, a 13% increase over the previous year, indicating growing buyer confidence despite affordability challenges and elevated interest rates. This growth is reflected in the 3.1% rise in the average house price since the previous quarter in the second quarter of 2024.
The market exhibits regional variations. For example, Torfaen experienced a notable 14% quarterly price increase due to high-value sales and limited supply, while Gwynedd saw price declines linked to policy changes such as adjustments to second home taxation and new planning rules. Wrexham experienced the biggest drop at 10% year-on-year in the second quarter of 2024.
The Royal Institution of Chartered Surveyors (RICS) reports the fastest rate of house price acceleration in Wales since 2022, with a strong uplift in newly agreed sales in June 2024. Surveyors, however, remain somewhat cautious about upcoming price trends, with some expecting price easing in the near term, and note a slowdown in new properties entering the market.
Official UK House Price Index data from May 2025 confirms a 5.1% annual price increase in Wales, with average prices around £210,000. First-time buyers paid just under £180,000 on average, with mortgage-funded purchases slightly higher than cash transactions. Over the longer term, prices in Wales have grown roughly 58% since 2015, demonstrating robust growth compared to UK averages.
In contrast to Wales, the broader England & Wales market has seen falling prices but with emerging signs of stabilization and recovery toward mid-2025. Wales appears relatively resilient in this context, with steady prices and strong sales suggesting a healthier outlook.
The Welsh government has pledged to deliver 20,000 new low-carbon homes for rent within the social sector during their current term. Detached houses were discovered to be the most popular type of property, with 66% of survey respondents considering the type and size of a property while hunting.
In summary, the Welsh housing market is showing a cautiously positive outlook for 2024 and into 2025, supported by stable prices and improving transaction volumes amid wider economic challenges. The second quarter of 2024 may represent a new dawn for the housing market in Wales, with expectations of house prices increasing and transaction volumes rising.
[1] Principality Building Society's House Price Index, 2024 Q2 [2] Royal Institution of Chartered Surveyors (RICS), 2024 Q2 [3] Official UK House Price Index, May 2025 [4] Principality Building Society's House Price Index, 2015 - 2024 [5] UK House Price Index, England & Wales, 2022 - 2025
- In light of the robust growth in the Welsh housing market witnessed in Q2 2024, investors might consider investing in real-estate, given the steady increase in housing prices and the surge in housing transactions.
- The Welsh government's commitment to provide 20,000 new low-carbon homes suggests potential opportunities for financing in the housing sector, contributing to the growth and recovery of the Welsh housing market.
