Even though we are only in May, the 2025 property market has already seen a bit of a roller coaster ride, and it’s set to continue, especially with the ever changing influences both at a global and domestic level.
We started the year exceptionally well, with more properties coming to market and buyers keen to purchase before the Stamp Duty Land Tax temporary reductions (in England) ended on March 31st.
According to Twentci, in the first quarter of 2025:-
- There were 3.7% more properties on the market than Q1 2024.
- Exchanges are up by over 24% when compared to Q1 2024.
- Sales Agreed are 9.3% higher than Q1 2024.
However, Twentyci’s data shows that across the UK, different areas are experiencing different market conditions, with the South East being the most ‘challenging’ area to sell a property currently and the North East being one of the most buoyant markets.
Once Stamp Duty Land Tax (SDLT) rates had returned to normal, we did expect to see a slight fall in activity in April, mainly because so many sales had been brought forward into March.
However, we then had the news from the USA that tariffs were going to be increased and although the UK was hit less hard than other countries, certainly for the car and other industries, this spooked the financial markets and introduced more economic uncertainty.
So it’s not a surprise that those looking to move hesitated a little bit more and as a result, April has been a little quieter than activity to date, although interestingly, sellers are still keen to market their properties, it’s buyers that decided to hold off for a short period of time.
This has resulted in more properties being available for sale than we have seen for some years, so it’s good news for buyers, while sellers need to be pricing more keenly to sell.
A few weeks into May, the economy and the property market in the UK are looking up. Not only have we agreed a trade deal with America, but we’ve also concluded trade negotiations with India. As an added bonus, on May 8th, 2025, the Bank Base Rate was reduced to 4.25%.
The market summary so far this year is that we have plenty of properties for sell, buyers are out there and are making offers, albeit at a slightly lower pace than the first quarter of March 2025 and the outlook for the property market continues to look good.
What's happening to property prices in your area?
According to the latest government data from the Land Registry, property prices in the UK increased by 5.4% year over year until the end of February 2025, although bear in mind this data measures the market from some months ago.
Each country’s performance is showing different rates of price growth:-
- England: 5.3%
- Wales: 4.1%
- Scotland: 5.7%
- N.Ireland: 9%
Price growth (or falls) contrast starkly when you look at what’s happening regionally. Property prices in high-priced areas such as London are up by just 1.7%, whereas prices in more affordable areas such as the North East record 7.9% rises.
We are also seeing a difference between the property types being sold, with London seeing rises of 3.9% for detached homes on average and a slight fall for flats (-0.1%); while in the North East, detached homes are seeing rises of 9.2% versus 5.3% for flats.
Unusually for the property market, according to Rob Owen, Head of Research for esurv “Overall, the housing market reflects a two-tier dynamic, with northern regions reaching fresh market highs while southern regions, particularly London, continue to face affordability constraints.”
This time last year, prices in London had fallen by more than 6%, while today they are recording a small fall. In contrast, the North East showed hardly any falls this time last year and is experiencing property price growth, on average of just under 6%.
It’s not surprising that we are seeing this trend. With mortgage rates higher than normal due to the Bank Base Rate (BBR) hikes, the impact on affordability for those buying more expensive homes in the South and East of England is much higher than that for those buying in the Midlands and North.
However, it’s also important to remember that the property market is made up of many different markets based on property type, location, and price point.
Sellers who price fairly should always be able to sell and may sell quickly, for a good price, the same would happen if two or more buyers compete to purchase one property for sale, so whatever is happening in the wider regional market, it’s about the property market for individual properties on an individual street.
As we are selling properties across the country we know that whatever is happening nationally, it doesn’t necessarily mean that’s what’s happening to the property you want to buy or sell.
There are so many micro markets in property. Although the property price indexes are a useful guide to what’s happening to property prices, they tend to be a month or more out of date.
As the property market can turn from positive to negative within this time, it’s essential to speak to a qualified agent who is a member of Propertymark, like Your Move, to ensure you understand what’s happening to the specific property type in the location you looking to buy or sell in, now.
What’s the outlook for property prices for the rest of 2025?
The good news is that although we have had a bit of a lull in the property market and the news in April 2025 that mortgage lenders are now offering mortgages at sub 4% (typically for those fixing for two or more years and with a high deposit), plus BBR fell to 4.25%, affordability is improving and is expected to get better with forecasted BBR falls to a low of 3.5% to 3.75% by the end of the year.
Are you thinking of buying or selling a property? Do talk to one of our local property experts. They will be happy to explain what’s happening to your individual property market and help find the right property to suit your needs.
The Your Move Content Marketing Team
