UK Housing Market Rebounds in 2025 as Mortgage Rates Improve

After years of turbulence, the UK housing market is showing signs of recovery in 2025, bolstered by improved mortgage rates and a significant increase in properties available for buyers. Estate agents are reporting their busiest period since the post-lockdown property boom of 2021, with more people actively looking to move this spring.

According to data from property platform Zoopla, there has been a 6 per cent rise in house sales compared to this time last year. Sales pipelines at estate agencies are at a four-year high, driven by lowered borrowing costs and better mortgage availability, which are attracting buyers back into the market. Areas in the north of England and Scotland are particularly active, with increased activity from both buyers and sellers alike.

Housing supply has also seen a significant boost, with 13 per cent more homes listed for sale compared with spring 2024. This surge in available properties is helping to stabilise house prices. While the average UK house price has risen 1.6 per cent in the past 12 months to £268,250, buyers are managing to negotiate more favourable deals, with offers typically 3 per cent below the initial asking price being accepted.

The increased supply of homes is particularly evident in regions such as the southwest of England, London, and the southeast, where the number of listings has risen by 21 per cent, 17 per cent, and 15 per cent respectively. In contrast, listings in the northwest have only grown by 3 per cent over the past year, contributing to regional variations in house price growth.

Regions with traditionally more affordable housing markets, such as Blackburn and Belfast, have seen prices rise by over 5 per cent in the last year. Meanwhile, cities like Aberdeen, Bournemouth, and Brighton have experienced slight declines in property prices, reflecting the ongoing north-south divide in the housing market.

Market experts, including Zoopla’s executive director Richard Donnell, expect this trend to continue throughout the year. He predicts that house prices will moderately rise by 2 per cent across the UK in 2025, while the total number of sales is anticipated to grow by 5 per cent compared to 2024. Lower mortgage rates and more favourable affordability criteria from lenders are likely to sustain buyer demand as the market moves into the latter half of the year.

With more options and improved borrowing conditions, the market is offering increased opportunities for buyers, making 2025 a potential turning point for the UK property sector.