May Housing Update: Market Hits Record
The May housing update shows the UK market edging higher, with average asking prices nearing the £380,000 mark. While this marks another milestone for sellers, the pace of growth has moderated compared to previous years. Industry professionals note that a mix of seasonal trends, increased housing stock, and cautious buyers is shaping a more balanced landscape.
Average Asking Prices Climb Modestly: May Housing Update
In May 2025, the average asking price for a home reached £379,517 – an increase of 0.6% (£2,335) from the previous month. Although this represents a new record, the monthly price rise is the most modest May increase since 2016, suggesting a shift in market dynamics.
Annual price growth stood at 1.2%, slightly trailing April’s year-on-year figure of 1.3%. The subdued price rise comes amid a notable increase in housing stock and a more discerning group of buyers.
Market Activity Adjusts After Busy Spring
The typically vibrant spring market saw a rush of transactions in March, driven in part by changes to stamp duty in England and Northern Ireland. Many buyers hurried to complete purchases before the changes took effect, resulting in a temporary surge in demand.
However, this burst of activity has been followed by a lull. In April, demand for properties dipped by 4% compared to the same period in 2024 – the first decline in buyer interest this year. Even so, year-to-date figures remain positive, with buyer enquiries still 3% higher than last year overall.
Sales volumes remain healthy, with the number of agreed sales in May tracking 5% ahead of the same time last year. This suggests that while demand has cooled slightly, buyers still pursue properties when sellers price them competitively.
More Properties Enter the Market: May Housing Update
One of the most significant trends this spring is the abundance of available properties. The number of new listings has surged by 14% compared to May 2024, pushing the volume of homes on the market to the highest level seen in a decade.
This influx of supply offers buyers greater choice but places increased pressure on sellers. With more competition, overpriced homes risk being overlooked. As the market shifts towards greater equilibrium between supply and demand, pricing strategy has become crucial.
Property expert Colleen Babcock observes, “This month’s relatively small price increase reflects the growing need for sellers to be realistic. Buyers are presented with more options, and those that appear overpriced simply won’t make the shortlist.”
A Buyer-Friendly Environment Emerges: May Housing Update
The current climate may prove favourable for buyers. The wider selection of homes, modest price rises, and the potential for lower borrowing costs are contributing to improved conditions for those entering the market.
Experts advise sellers to approach the market with strategic pricing and informed expectations. Partnering with estate agents to analyse local trends and set competitive asking prices could be key to securing a sale.
Mortgage Rates Show Signs of Easing
One of the most significant influences on market sentiment in 2025 has been the gradual reduction in mortgage rates. The lowest available two-year fixed-rate mortgage currently stands at 3.72%, down over a full percentage point from 4.75% a year ago.
While interest rates remain above their historic lows, the downward trend is encouraging for prospective buyers. The Bank of England’s second base rate cut of the year is expected to spur further reductions by lenders, offering additional support to affordability.
Babcock adds, “We’re not anticipating dramatic shifts, but even small rate drops make a meaningful difference to monthly repayments. Combined with rising wages and stable house prices, this could revitalise demand as the year progresses.”
Looking Ahead: Stability with Subtle Shifts
Despite the cooling in new buyer demand and subdued monthly growth, the broader outlook remains stable. The fundamentals – such as employment levels, wage growth, and interest rates – are largely supportive of a steady market.
However, the days of double-digit price surges appear to be behind us, at least for now. Instead, the housing market is entering a phase marked by greater balance and more considered decision-making from both buyers and sellers.
For sellers, success in this environment will depend less on riding market momentum and more on positioning their property effectively. Meanwhile, buyers may find 2025 presents more opportunities for negotiation and value.
