Property Market Update: May 2025

Welcome to the May edition of the Property Market Update! We’ve gathered insights from leading indices and industry voices to bring you a comprehensive overview of what’s shaping the UK housing market right now — from price movements and buyer behaviour to mortgage rates and stock levels.

House prices stable with regional highs

April brought a mixed bag for house price trends, but the overall picture remains one of resilience. The average UK house price now sits at £297,781 according to Halifax, following a modest +0.3% monthly increase and a solid annual growth rate of +3.2% – the highest recorded so far this year. Nationwide reported a -0.6% monthly decline, bringing its annual growth to 3.4%, still firmly in positive territory.

Rightmove, meanwhile, recorded a new national record for asking prices, rising 1.4% to £377,182. All Midlands and Northern regions hit fresh highs, with even London reaching a new peak – though that may prove short-lived given the capital’s sensitivity to global volatility.

Stamp Duty changes shake but don’t break momentum

Despite the much-anticipated Stamp Duty increase in early April, market activity has held firm. While there was a predictable surge in completions during March, the expected post-deadline drop-off has so far been modest.

Encouragingly, the number of agreed sales falling through remains steady, and many buyers who missed the Stamp Duty deadline have continued with their purchases. In fact, the queue of completions has eased by almost 24,000, suggesting a degree of normalisation.

Buyer demand softens – but only slightly

There are signs that buyer demand has cooled slightly from the elevated levels seen earlier this year. Zoopla notes that demand is now just 1% higher than this time last year, down from 10% above in the early months of 2025. Seasonal factors – including the Easter holidays – and wider economic uncertainty appear to be making some buyers more cautious.

That said, demand remains relatively strong by historical standards. Halifax points out that activity is still robust compared to recent years, with affordability improvements and rising stock levels helping to support interest.

More homes on the market boosts choice

On the supply side, the market is in much better shape than a year ago. The number of homes listed for sale is now 12% higher year-on-year, while estate agents are reporting an average of 34 homes per branch, up from 31 last spring.

This increase in stock is keeping house price inflation in check while also improving options for active buyers – a welcome change from the tight supply of previous years. Importantly, many sellers are also buyers, which helps to keep transaction volumes buoyant.

Mortgage market shows glimmers of opportunity

The mortgage landscape saw a notable shift this month with the Bank of England cutting the base rate to 4.25% on 8th May, in response to easing inflation. This move follows growing expectations that further cuts may follow, particularly if inflation remains on its current downward trajectory.

At the same time, mortgage pricing is becoming more attractive. As of 8th May, the average two-year fixed mortgage rate was 5.14%, while the five-year fixed rate stood at 5.08%, according to Moneyfacts.

Lenders are also relaxing stress testing rules for new borrowers. This could increase buyer affordability by 15–20%, which is likely to support transaction volumes more than house price growth in the months ahead.

Summary: a market finding its balance

While the property market is not without challenges — from global trade concerns to fluctuating confidence — the underlying conditions remain supportive. Low unemployment, real wage growth, improving affordability and a growing number of listings all suggest the market is in good health.

House price growth may slow through the summer, but early signs suggest activity levels will remain steady. With stronger stock levels, competitive mortgage deals and a gradual return to normalised buying conditions, the market looks to be on course for a stable, if slightly more measured, summer period.