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.
Confidence Grows, but It’s a Mixed Bag
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 4.0% and expected to reduce further by the end of the year, more people are looking to move while conditions remain relatively stable.
What Buyers Need to Know
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 leading two-year fixed mortgage have dropped to around 4.0%, marking its lowest point in almost three years, when rates hovered around 4.24%. Similarly leading five-year fixed prices are also at around 4.0%. 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, some 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.
What Sellers Should Expect
Sellers are finding more motivated buyers. 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. Mortgage rates are stable, demand is decent, and autumn always brings more competition. Getting listed now can help you beat the rush. Get in touch!
The Lettings Market: Still Under Pressure
Rental demand continues to exceed supply across most of the UK. Zoopla’s latest Rental Market Report shows average UK rents up 6.5% year-on-year, with some city centres seeing even higher jumps. In reality the increases tend to be at the cheaper end of the market.
While this might sound like good news for Landlords, there’s a fine line. Tenants are becoming more selective, and affordability is being tested. Many landlords are in wait-and-see mode as they prepare for the impact of the Renters Reform Bill, which is still making its way through Parliament. Key proposals include the abolition of Section 21 ‘no fault’ evictions and the introduction of a new property portal and ombudsman.
Final Thoughts: Make Your Move, But Stay Sharp
The property market in July 2025 is active and encouraging. Buyers levels are solid, sellers are benefiting from increased interest, and renters - while still facing tough competition - may soon see improved conditions if supply recovers.
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 most experienced Estate Agent in our part Surrey, 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.
Nicholls Residential are your local property experts in our region of Surrey. Call us on any of the numbers listed below or email This email address is being protected from spambots. You need JavaScript enabled to view it. to chat with a member of our friendly and experienced team.
Chessington Office – 0208 391 1110
West Ewell Office – 0208 786 7879
Epsom (Town Centre) Office – 01372 730111
North Cheam Office – 0208 644 3480
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.
