In June 2025, the average property price in the UK was £296,665, showing a small drop from May’s £296,782, according to Halifax. House prices remained stable, with no monthly change and a 2.5% increase since June 2024. After a brief slowdown due to spring stamp duty changes, mortgage approvals and property transactions are on the rise. Factors like growing wages, which help with affordability, and stable interest rates are boosting buyer confidence.

Stable House Price Growth

The slight decrease of just £117 in the average property price from May to June indicates stability rather than a worrying trend. Monthly statistics so far this year have not fluctuated dramatically, showcasing market resilience. The annual 2.5% increase shows slow but steady growth, indicating an adjustment to a more stable environment. Following the spring tax changes, property transactions briefly slowed down, but this seems to have been a temporary setback. Increased mortgage approvals and higher transaction volumes show this trend is reversing. As real wages rise and the central bank maintains interest rates, more buyers are stepping into the market. The boost in real household income is giving people the confidence to buy, especially first-time buyers. For those planning in the market, the stability in policy is crucial. Interest rates appear stable in the short term, and borrowing costs have leveled out, leading to clearer planning. We find that fixed-rate mortgages offer more predictability for homebuyers compared to variable rates, supporting steady buying activity. Gardner has noted that if wage growth continues to outpace inflation, as current data suggests, we may see ongoing modest gains in house prices. We agree. The buyer pool could expand soon, particularly in suburban areas where prices are more affordable. We’re already seeing this reflected in increased listings.

Regional Variations and Strategy

Kinnaird mentioned that while prices are about 19% higher than pre-pandemic levels, this doesn’t mean the growth is unsustainable. When adjusted for inflation and wage growth, this increase looks more controlled. This reflects the more cautious lending environment and careful borrower profiles compared to past cycles. Lenders remain cautious yet willing, which may help reduce volatility. Some regions are behaving differently from national trends. In cities with significant affordability challenges, like London, price growth is notably slower. We see this as a need to focus on regional differences rather than relying solely on national averages for predictions. For those tracking price movements, adjusting based on transaction volumes can be more insightful than price changes alone. Monitoring transaction numbers alongside mortgage rates on a weekly basis can reveal shifts in buyer confidence. This detailed approach can help predict short-term changes, especially in areas gaining buyer interest. Paying attention to upcoming economic data is also essential. The next CPI reading will show whether interest rate expectations remain steady or shift again. Any change here could quickly impact borrowing sentiment and consequently affect transaction numbers and property prices. Recently, we’ve seen how housing data impacts interest-sensitive assets. An unexpected change in employment or wage figures could affect property-related assets, especially those linked to development forecasts or household credit models. In summary, we don’t anticipate significant price fluctuations soon. However, the data suggests there are opportunities for targeted actions in areas where income is rising quickly or lending activity is trending positively, albeit cautiously. Create your live VT Markets account and start trading now.

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