UK Property Market Update: London and Regional Price Trends – June 2025

The UK property market continues to display a dynamic mix of price movements, with London and regional areas each charting their own unique course. As we enter the summer of 2025, both buyers and sellers are navigating a landscape shaped by shifting demand, stamp duty changes, and evolving mortgage rates. Here’s your essential guide to the latest UK house prices, expert predictions, and what it means for your next property move.

National Overview: A Tough Sellers’ Market with Resilient Buyer Activity

The average asking price for a home coming to market in June 2025 stands at £378,240, marking a slight monthly dip of 0.3%—an unusual trend for this time of year, which typically sees price gains. This drop follows record highs in April and May, and is partly attributed to a delayed reaction to April’s stamp duty changes for England and Northern Ireland.

Despite this, buyer activity remains robust. May 2025 recorded the highest number of sales agreed since March 2022, and buyer demand is 3% higher than a year ago. However, with the number of homes for sale up 11% year-on-year, sellers must price realistically to attract serious offers.

London Market: Regional Variations and Price Corrections

London’s property market is experiencing notable contrasts:

Central London: The most exclusive postcodes have seen the sharpest corrections, with some reports indicating year-on-year drops as high as 31% for certain segments. However, current averages for Central London flats stand at around £1.2 million, with terraced homes averaging over £3.1 million—reflecting the resilience of prime assets.

North, East, South, and West London:

• North London: Flats average £600,766

• East London: Flats average £457,784

• South London: Flats average £453,154

• West London: Flats average £830,855

Recent Data: June 2025 index shows London’s average asking price at £695,414, with a monthly change of -0.9% and no annual change. The UK House Price (April 2025) reports London’s average price at £567,000, with a 3.3% annual rise but notable volatility month-to-month.

Key Insight:

While some areas have seen double-digit percentage drops year-on-year, experts predict a rebound in London property values over the next 12–18 months, driven by renewed investor interest and improving affordability for first-time buyers.

Regional Highlights: Where Prices Are Rising and Falling

The UK property market is far from uniform. Here’s a snapshot of key regional trends:

• Scotland: Leads the pack with a 4% year-on-year increase in house prices, reflecting strong demand and limited supply.

• North West, Wales, and Yorkshire & The Humber: These regions are outperforming, with prices rising fastest in June 2025. The North West, for example, has seen a 3.9% annual increase.

• South East and South West: Higher-priced southern regions have experienced larger price drops, impacted by increased stamp duty and a surge in available homes for sale.

• National Average: The UK-wide annual price growth stands between 1.6% and 3.7%, depending on the index used, with most regions showing steady appreciation rather than rapid gains.

Factors Influencing the Market

Several macroeconomic and policy factors are shaping the UK property landscape:

• Stamp Duty Changes: The April 2025 increase in stamp duty for properties above £125,000 (for non-first-time buyers) has cooled demand in the South and London, contributing to price corrections.

• Mortgage Rates: The average five-year fixed mortgage rate is now 4.61%, slightly down from last year’s 5.04%. Lower rates and looser affordability criteria are supporting buyer activity.

• Supply and Demand: A decade-high level of homes for sale is giving buyers more choice and negotiating power, while sellers must price competitively to secure a sale.

• Inflation and Wage Growth: Average wages are rising faster than house prices in many areas, improving affordability for some buyers.

Luxe Living Expert Advice

In today’s dynamic UK property market, setting a competitive and realistic asking price is more important than ever. As we observe a decade-high level of homes for sale and robust buyer choice across all regions, sellers who price their properties attractively stand the best chance of securing serious interest and a successful sale. The market is highly price-sensitive, with strong regional variations driven by affordability and local supply levels.

Buyers now benefit from an unprecedented selection of high-quality homes, particularly in sought-after prime and coastal locations, where value-driven pricing is helping to revitalise activity and restore confidence. For sellers, flexibility and a keen understanding of current market conditions are essential to stand out and achieve your property goals. For buyers, the current environment offers exceptional opportunities to negotiate and secure a property that truly meets your aspirations.

What This Means for Buyers and Investors

For Buyers:

• This is a favorable time to buy, with more choice and negotiating power than in recent years.

• Properties priced right and presented well are attracting strong interest and quick sales.

• Mortgage rates, while still above pre-pandemic levels, are stabilizing, and lenders are expanding borrowing limits for high-net-worth individuals.

For Sellers:

• Pricing realistically is essential to stand out in a crowded market.

• Homes that attract an enquiry on the first day of marketing are 22% more likely to find a buyer than those that take longer.

Conclusion: Navigating the UK Property Market in 2025

The UK property market remains resilient, with regional variations and ongoing price corrections in London and the South. While some areas face short-term headwinds, the overall outlook is positive, with steady price growth in most regions and signs of recovery in prime London markets. For buyers and investors, staying informed and agile is key to capitalizing on the current opportunities.

Stay ahead of the market with Luxe Living International’s latest UK property news and expert insights. Whether you’re buying, selling, or investing, our team is here to guide you through every step of your property journey.

Ready to make your move? Contact Luxe Living International today for personalized advice and access to the latest property opportunities.

Visit our blog for more updates and expert insights.