As of April 2025, the South Wales residential property market is experiencing a nuanced recovery following a period of decline. Here’s an overview of the current landscape:
House Prices and Market Trends:
After a downturn in early 2024, where average house prices in Wales fell by 6.5% year-on-year, the market has shown signs of stabilisation. By December 2024, the average house price in Wales increased by 3.0% over the previous year, reaching £208,197.
In South Wales, price changes have varied:
Newport: Average house price of £239,215 in Q1 2024, marking an 8.1% annual decrease.
Cardiff: Experienced a 5.6% annual decline in average house prices during Q1 2024.
Vale of Glamorgan: Saw the most significant drop with a 15.7% annual decrease in Q1 2024.
Conversely, Blaenau Gwent reported annual an increase of 8.6% during the same period.
Market Activity and Demand:
The latter half of 2024 witnessed a resurgence in market activity, with transactions surpassing 2023 levels by 10% over a five-month period. This uptick is attributed to improved economic conditions and a decline in mortgage rates, which reached their lowest in two years. Despite this, transaction volumes remain approximately 15% below the 2017–2019 average, indicating a cautious recovery.
Housing Supply and Development:
New housing developments face challenges due to historically low planning consents, which have decreased by 41% since their 2022 peak. This decline is expected to lead to reduced housing completions in the near future. Affordable housing delivery is under pressure, with a projected shortfall in meeting the Welsh Government’s target of 20,000 homes by March 2026. Rising construction costs, up by 24% since May 2021, contribute to this challenge.
Outlook:
Looking ahead, house prices in Wales are expected to outperform the UK average over the next five years, with a projected growth of 25.2%. This optimism is based on improving affordability and sustained demand.
