Zoopla’s House Price Index Report: May 2025
Adapted from a Zoopla article by Richard Donnell 28 May 2025
Lower mortgage rates are supporting more house sales against a backdrop of modest house price inflation. Zoopla’s House Price Index tracks key trends in the UK housing market - here’s the latest news in May 2025.
Key takeaways
- The number of sales agreed in May is the highest it’s been for 4 years and up 6% on last year
- The rise comes as the market rebounds after the Easter lull and initial reaction to stamp duty relief ending
- House price growth is stable with a 1.6% rise compared to a year ago
- More sellers are listing their homes for sale, with a 13% rise on last year
- Northern regions of England are seeing the strongest growth in sale numbers and annual house price rises of 3%
- Southern regions have more homes for sale and lower house price growth of less than 1%
- There’s a wide variation in house price growth across UK cities, from modest falls in Brighton and Aberdeen to 5%+ gains in Blackburn and Belfast
- The housing market is on track for 5% more sales and 2% price inflation over 2025
Key figures
The average house price in the UK is £268,250 as of April 2025 (published May 2025). This is a rise of 1.6% or £4,330 over the past year.
Rebound in sales after initial reaction to end of stamp duty relief
The number of housing sales is on the rise with home buyers returning to the market after the end of stamp duty relief and the Easter holidays.
Latest data shows the number of sales agreed per estate agent at this time of year is running at the fastest rate for 4 years, since the pandemic boom of 2021. This is due to a high number of homes for sale and improvements in mortgage rates and availability.
There are 13% more homes for sale than a year ago. The average estate agent office has 35 unsold homes. Most of these home sellers are also buyers, which means plenty of interest for well-priced homes. More mortgage products with sub-4% rates, together with changes to how mortgage affordability is calculated, are encouraging buyers to make offers, supporting a 6% growth in sales agreed.
Data shows the average home sale is currently being agreed at 3% (or £16,000) below the average asking price, a level that has been stable over recent months.
6% more agreed sales in May 2025 than a year ago
The shift to higher mortgage rates over the last 3 years has impacted growth rates for housing sales and mortgage applications. Sales declined sharply in 2022/23 as mortgage rates reached 6%.
The growth in sales rebounded over 2024 as mortgage rates fell, which also boosted demand for mortgages. However, the growth in sales and mortgage approvals has slowed in recent months to more sustainable levels.
Sales have now started to increase once again as confidence improves and those using a mortgage are able to borrow up to 20% more due to changes in affordability testing.
Most affordable areas record fastest sales growth
Housing market activity and house price inflation are currently strongest in areas where homes are more affordable. In broad terms, this covers most areas outside the southern regions of England.
Our data shows northern regions of England, Scotland and the East Midlands are registering the fastest growth in agreed sales compared to a year ago. However, affordability constraints are behind a slower growth in sales across southern regions of England, with a decline in sales in the West Midlands compared to a year ago.
The number of homes for sale is an important influence on market activity and house prices. More homes for sale boosts buyer choice and keeps price growth in check. Faster growth in sales erodes the number of homes for sale, limiting what is available and supporting faster house price growth.
More homes for sale across southern England
The number of homes for sale has grown most quickly across southern regions of England, boosting choice. There are 21% more homes for sale in the South West compared to a year ago, with 17% more in London and 15% more in the South East.
Slower growth in sales and more homes for sale explains why house price growth is less than 1% across all regions of southern England - ranging from 0.5% in the South East to 0.9% in the South West.
Outlook for the housing market in 2025: modest price gains and more sales
Strong competition in the mortgage market and less stringent affordability testing is set to support buyer demand and sales volumes over the second half of 2025.
The different trends in supply and demand across the country have important implications for how sellers approach the pricing of their homes if they are serious about selling in 2025. Buyers also need to adapt to local market conditions in how they pitch offers to buy.
Overall, the housing market is well set for 5% more sales in 2025 compared to last year, with just enough house price inflation to keep sellers and buyers entering the market and making bids for homes.
We expect this variation in price inflation to continue over the rest of the year as home values rise in more affordable areas.
To read the article in full please visit.
www.zoopla.co.uk/discover/property-news/house-price-index/
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