UK Property Market Forecast for mid-2025

Mon 04 Aug 2025

UK Property Market Forecast for mid-2025

The UK property market in 2025 is showing signs of cautious recovery following the impact of April's stamp duty changes. House prices are broadly stable, with annual growth ranging from 1% to 3.5% depending on the source. Buyer demand returned in June, supported by the first interest rate cut to 4.25%, with more reductions expected later in the year.

Affordability remains a key constraint, especially in southern England, while regions like the North East and Scotland are seeing stronger price growth. The rental market is tightening, with rents rising by around 7% year-on-year due to landlords leaving the sector and fewer homes available to let.

Expert forecasts suggest modest house price growth of 2–4% in 2025, with stronger gains possible in 2026. Government funding and build-to-rent developments are expected to boost supply. Overall, the market outlook is steady, with opportunities for buyers and investors in value-driven and regional locations.