House prices in Wales has risen at the fastest rate in more in two years, according to latest research from Principality Building Society.
Its house price index, for the first quarter (Q1) of this year shows, that the average price of a home sold in Wales increased to £238,413, up 2.2% on the previous quarter and 4% higher than the same period last year. The average price is still below the record high of £239,642 in July 2024.
While affordability challenges remain, the steady rise in both prices and the number of transactions – which reached 10,000 in Q1 (up 20% on last year) – suggests buyer confidence is still growing.
Three local authorities in South Wales saw house prices reach record highs, with Bridgend seeing the highest annual change of any authority at 11% (to £244,060), followed by Blaenau Gwent which reported an increase of 6.8% (to (£160,245) and Caerphilly up 6.6% (£214,354).
Of the local authority areas seeing falls, Ceredigion experienced the biggest at 10.1% to £241,321 on the final quarter of 2024, with the rise in tax on second homes a likely key factor.
Iain Mansfield, chief financial officer at Principality Building Society, said: “The housing market in Wales has had a positive start to 2025, with prices rising quarter on quarter at their fastest pace in over two years.
Despite a challenging economic backdrop, we’re seeing a year-on-year growth of transactions, spurred on by supply challenges and falling rates. Meanwhile, affordability remains a key factor shaping the market landscape.”
On the outlook, Mr Mansfield said “Across Westminster and Wales, housing is high on the agenda. Looking ahead, the Ƶ Government remains publicly committed to extensive planning reforms – setting out an ambitious target to build 1.5 million homes over the next five years, representing a significant shift in the Ƶ’s housing landscape.
“This, paired with the Welsh Government’s Help to Buy Wales extension and additional £10m investment allocated to kickstart housing schemes across Wales signals a clear message that policymakers recognise the importance of housing to families and individuals across the country.
“Despite external pressures such as cost of living, inflation, and global economic pressures, the housing market in Wales is moving forward in a positive direction, with increased consumer confidence and areas of strong regional performance.”
