Property Market Update: February 2025

Sam Edwards

Senior Writer & Researcher

Table displaying the latest changes to the bank of England's base rate and average mortgage rates

Welcome to the February 2025 Property Market Update! We've gathered insights from across the UK to provide you with the latest market trends.

Base rate cut boosts market opportunities

The Bank of England's decision to cut the base rate to 4.5% marks the next stage in the bank's recovery plan from high inflation, creating new opportunities in the property market. Lower borrowing costs will encourage more buyers to enter the market, potentially increasing competition for well-priced properties.

House prices break records

The market continues to show strength - Halifax reports a new record high of £299,138 following a +0.7% monthly increase, while Nationwide shows a 4.1% annual growth. Zoopla reports prices up 2% year-on-year at £267,700, with Northern Ireland (+7.7%) and the North West (+3.2%) showing particularly strong performance.

Market activity and stock levels

Market activity indicates robust buyer interest, with Zoopla reporting a +12% increase in agreed sales compared to last year and Rightmove showing post-Boxing Day sales up +11%. Estate agents are reporting their highest January inventory in seven years, averaging 31 properties per branch.

While this increased choice means more competition, properties priced correctly from the start are achieving better results, making it essential to work with experienced agents who understand your local market.

Mortgage market shows growing confidence

According to the Moneyfacts, the average two-year fixed mortgage rate was 5.50% as of February 6, 2025. The average five-year fixed mortgage rate was 5.30%. This improved affordability, combined with the base rate cut, creates excellent conditions for achieving a successful sale.

Strong buyer demand continues

Market confidence is boosted by the +13% increase in buyer demand compared to last year. Particularly encouraging is the surge in first-time buyers, with 22% of renters looking to purchase. The upcoming Stamp Duty changes have accelerated activity in the £300,000-£625,000 price range.