The second half of 2025 is here, and the housing market is still full of energy - and a few surprises. While the outlook for the rest of the year is cautiously positive, it’s not without its sticking points. Whether you're buying, selling, letting, or renting, here’s what you need to know about how the market is shaping up this July.
House price trends have stabilised across most regions, with average values holding steady after last year’s modest dip. According to the latest UK House Price Index from HM Land Registry, average prices as of May 2025 (the most recent data available) the average house price in the UK is £268,652, and the index stands at 103.0. Property prices have risen by 1.1% compared to the previous month and risen by 3.9% compared to the previous year.
Transaction volumes have also bounced back. The Bank of England reported that mortgage approvals for house purchases hit 61,000 in May 2025 - the highest monthly figure since late 2022.
This is being driven by both buyers and sellers becoming more confident in the outlook. With base rates now sitting at 4.25% and expected to reduce further by the end of the year, more people are looking to move while conditions remain relatively stable.
For buyers, the picture is improving. Mortgage rates have eased slightly in response to falling inflation and the Bank of England’s rate cuts. The average two-year fixed mortgage dropped to 5.09%, marking its lowest point in almost three years, when rates hovered around 4.24%. Similarly, typical five-year fixed prices dipped to 5.08% and were last lower in October 2024 at 5.07%. Lenders are also adjusting their affordability rules. Loan-to-income caps are more flexible, and some banks are extending repayment terms up to 40 years for younger buyers. Stress testing requirements - the ones that check if you can still afford payments at a hypothetical higher rate - are being gradually relaxed.
That said, affordability remains tight, especially in high-demand areas. Having your paperwork ready and a mortgage decision in principle sorted before viewing homes is still the best move.
Sellers are finding more motivated buyers - especially those upsizing or moving for schools before the September term starts. However, there’s still a price sensitivity in the market. Overpricing can leave listings sitting stale.
With stock levels rising, the tide is shifting towards a more balanced market. Rightmove reports that the average time to secure a buyer has reduced to 55 days - down from 67 days a year ago - but only when the property is priced realistically.
If you’re thinking of selling, this is a good time to act. Mortgagerates are stable, demand is decent, and autumn always brings more competition. Getting listed now can help you beat the rush. Call us on 020 8660 2010 or generate a full report on your own property including an instant estimated valuation.
There’s growing expectation that the Bank of England will cut interest rates again before the end of 2025. As of July 2025, the UK’s annual Consumer Prices Index (CPI) inflation rate stands at 3.6%, according to the latest data from the ONS . The Bank is under pressure to support economic growth without triggering another round of price increases. Many analysts expect the base rate to fall to around 3.75% by December. If that happens, mortgage rates may drop further, giving more people confidence to enter the market.
The property market in July 2025 is active and encouraging. Buyers have more power than they did last year and sellers are benefiting from increased interest.
Whichever side of the market you're on, preparation is everything. Have your documents in order, research the local area, and work with professionals who can guide you through the process. Things are moving - just not always at the same pace for everyone.
If you're planning a move soon, now’s the time to get organised. Speak with us - your experienced estate agent in Purley, Croydon & Greater London, sort your finances, and make sure you’re ready to act when the right property comes up. There’s a sense that confidence is returning, and that’s often when the best deals are done.
Shinerocks is your local property expert for the Purley, Croydon & Greater London area. Call us on 020 8660 2010 or email enquiries@shinerocks.co.uk to chat with a member of our friendly and experienced team.
Note: The information in this article is based on data as of June/July 2025 and may change. Always seek professional advice for specific circumstances.
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