The UK housing market has surprised many this summer with a surge in activity. According to the latest House Price Index, buyer demand is up 11%, agreed sales are up 8%, and there’s a record number of homes for sale (See the HM Land Registry for official pricing data). Yet, despite all this movement, prices are rising at a modest pace, just 1.3% year-on-year, with the average home now valued at £268,400. So, what’s driving this activity, and why aren’t prices climbing faster?
Reading the House Price Index: A Market on the Move
The July 2025 House Price Index shows a lively property market. Flats and maisonettes fell by 0.8% year-on-year, while semi-detached homes saw the most substantial rise of 2.3%. Regionally, growth is strongest in Wales, Scotland, and the North of England (+2–3%), while London and the South East trail at just +0.2%. House prices jumped by 6.1% in Northern Ireland, albeit from a much lower base.
Interestingly, although more people are buying and selling, the supply of homes is also up 12% year-on-year, creating what analysts call a “buyers’ market”. More choice keeps competition high and stops prices from racing away.
Why the UK Housing Market is Cooling in 2025
If sales are booming, why is price growth so restrained? One reason is policy. The impact of stamp duty changes on UK house prices has been profound. Since temporary reliefs ended in April, 83% of homeowners now pay stamp duty when they move, compared with just 49% earlier this year. On average, buyers are paying an extra £2,500 per sale. Unsurprisingly, this has curbed the amounts people are willing (or able) to bid.
This aligns with findings from the RICS July 2025 housing market report, which highlighted falling buyer inquiries (down to -6%) and a slowdown in completed purchases (down to -16%). As RICS chief economist Simon Rubinsohn explained: “Uncertainty about the potential contents of the chancellor’s autumn budget is raising some concerns.” Buyers remain cautious, especially in the South.
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Rightmove Results: Revenues and Housing Demand Trends
Rightmove results also reflect this flurry of sales activity. More estate agents are signing up, with 276 new members in the first half of the year. Average monthly fees per agency hit a record £1,609, helping push revenues up 10% to £211.7m. CEO Johan Svanstrom described the mood as “more positive than in 2024 and definitely 2023.”
In essence, Rightmove is thriving regardless of market backdrop. When homes sell easily, agents have budgets for advertising; when sales slow, they need Rightmove more than ever. This underlines the Rightmove revenues and housing demand trends story: whether up or down, the property market continues to feed into the portal’s growth.
UK House Price Growth Forecast 2025: What’s Next?
The latest forecast for house price growth has been trimmed from +2% to +1% growth for the year. Mortgage rates are holding steady between 4% and 5%, according to the Bank of England, and affordability tests have been relaxed, allowing buyers to borrow up to 20% more without changes in income. Despite this, analysts expect the high number of properties on the market to keep a lid on prices.
For homeowners in the South, where competition is fiercest, success in 2025 may come down to realistic pricing. With London listing 19% more homes than last year, overpricing risks leaving properties languishing unsold.
If a high number of landlords continue to exit the private rental market, this will also serve to reduce the sale price of 1 and 2 bed flats which typically are used as let properties. This is good news for first time buyers but it will potentially make things difficult for those seeking to move up the ladder. Increased competition for buyers is likely to reduce market values and could increase the time it takes to secure a buyer.
The Bigger Picture: Balancing Confidence and Caution
The UK property market in summer 2025 is a curious blend of energy and restraint. On one hand, sales volumes and demand are strong; on the other, price growth is cooling. Analysts expect about 5% more homes to sell in 2025 than in 2024, but prices will rise only modestly.
For buyers, this means more choice and steadier prices. For sellers, it’s a reminder to price wisely. And for policymakers, the message is clear: tax and lending rules continue to shape housing affordability as much as demand itself.
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