Average UK house prices increased by 6.4%, to £271,000 in the 12 months to March 2025, according to provisional estimates in the ONS UK House Price Index – up from 5.5% in the 12 months to February.
Across the UK, average prices increased to £296,000 (up 6.7%) in England, £208,000 (3.6%) in Wales, £186,000 (4.6%) in Scotland, and £185,000 (9.5%) in Northern Ireland.
After news of rising inflation prompted a somewhat gloomy response from the property industry, the news of a buoyant homes market was welcomed.
Nathan Emerson, CEO of Propertymark, said:
“At a time when the wider economy remains a potential concern globally, it’s positive to see the UK housing market weather the storm well and deliver growth. It’s also positive to see continued momentum following what was a well-documented ‘Stamp Duty hike rush’ across England and Northern Ireland before thresholds changed from April 2025 onwards.”
Iain McKenzie, CEO of The Guild of Property Professionals, agreed that the data is encouraging ‘and aligns with positive undercurrents’ in the housing market. However, he warned against ignoring the impact of global economic events, saying growth ‘must be viewed within the context of a complex market’.
He added:
“The anticipation of further rate cuts, potentially down to 3.75% by year-end, will continue to stimulate activity. Yet, we cannot ignore the subdued economic backdrop and ongoing geopolitical uncertainties which will likely ensure a more measured pace of growth for the remainder of the year.”
With conditions in the rental market remaining challenging, Rachel Geddes,strategic lender relationship director at the Mortgage Advice Bureau, suggests the long-term advantage of monthly mortgage repayments offer an attractive prospect for those who are yet to get on the property ladder.
She commented:
“A growing number of lenders are using innovation to support homeownership, and coupled with the emergence of sub-4% interest rates, this has created a wealth of opportunities for borrowers.
“From zero-deposit mortgages to enhanced loan-to-income lending, previous obstacles to entering the housing market have been removed. This newfound accessibility means more prospective buyers than ever before can access the property ladder.”
Kevin Roberts, managing director of mortgage services at L&G, agrees that product availability opens up a clearer horizon for borrowers. He said:
“While the sunny weather might have been short-lived, the mortgage market is still heating up. Borrowers now have a wide range of products to choose from and we’re seeing fresh competition on pricing. In fact, we’ve just seen the biggest single drop in the average two-year fixed mortgage rate in over six months, so it’s vital that borrowers consult a mortgage adviser to pinpoint the best product for their needs.
“Younger first-time buyers remain one of the most active groups, and that activity may yet be stoked by the arrival of zero deposit mortgages and the growing availability of low deposit mortgages overall (which has just hit a 17-year high). Our broker search data showed a 53% increase in 18–30 year olds starting their homebuying journey in the first three months of the year. For now, the momentum is strong.”
However, while the outlook for potential buyers seems positive, Zoopla’s executive director of research Richard Donnell has a warning for sellers.
He said:
“We expect price inflation to slow over 2025 as our leading-edge data shows a high number of homes for sale and a slowdown in the pace of sales. Sellers should be careful how they respond to this data, and it’s important they keep their feet on the ground over how they price their home if they are serious about selling in 2025.”
