First-time buyers ready to move amid slowdown in UK house prices
According to today’s UK House Price Index from HM Land Registry, UK average house prices rose 2.8% in the year to July 2025, with a monthly increase of 0.3% from June 2025. The average price of property in the UK in June 2025 was valued at £270,000.
The latest regional data continued to show significant regional variations in prices across the UK, with the North East leading the way with the highest annual growth of 7.9%. In contrast, the London market saw the lowest annual inflation, with prices increasing by 0.7%. The South East and South West regions also saw modest growth of 1.2% and 1.4% respectively.
Peter Graham, Partner and Tax Lead for Real Estate and Construction at RSM UK, comments: “The UK housing market saw a slowdown in house prices in the year to July, compared to the previous month. The slowdown was especially notable across London, the South East and South West regions, with this cooling largely attributed to growing cautiousness among buyers following the Treasury’s recent proposed property tax changes. Households and investors are therefore waiting for clarity on stamp duty changes in the upcoming Autumn Budget before looking to purchase or sell property, which is therefore leading to inactivity and weakened buyer demand, as reported by RICS.
“While overall house price growth has decelerated, mortgage approvals have seen a modest uptick in July, which signals a positive shift for first-time buyers looking to enter the market. Additionally, the easing of mortgage criteria including the introduction of high loan-to-value mortgages, more affordable mortgage products and government-backed schemes which offer guarantees to lenders will also encourage first-time buyers to make the move from renting to home ownership. However, given regional disparities and proposed tax reform, the government needs to level the playing field and reverse gloomy market sentiment by introducing more equitable policies in the upcoming Autumn Budget.”
He added: “President Trump’s recent visit to the UK may have sparked renewed optimism around trade and the wider economy. We’ve already seen the benefits for the UK’s tech sector, with Microsoft investing £22bn to expand AI infrastructure and build the UK’s largest supercomputer. These developments could generate a ripple effect on housing demand, especially in key regional innovation hubs, which may drive renewed confidence among buyers and investors in the UK property market.”