We’re well into 2025 now, and the UK housing market’s showing a mix of stability and quiet activity. According to the latest House Price Index from Zoopla, price growth has slowed, but buyer demand hasn’t gone anywhere. In fact, there’s quite a bit going on beneath the surface.
Prices are up—just not by much
The average UK home now stands at £268,400, which is about 1.4% higher than this time last year. That’s roughly £3,700 more in 12 months—not massive, but still growth. And even though mortgage rates haven’t dropped dramatically, new lending rules mean buyers can stretch their borrowing a bit further, which has helped keep things moving.
Activity is strong, but it’s not driving prices through the roof
Here’s where it gets interesting. Despite the slow pace of price inflation, sales activity is picking up—in fact, homes are going under offer at the fastest rate in four years. That’s mostly down to the amount of stock coming onto the market. There are 14% more homes listed than a year ago, which gives buyers more leverage and keeps sellers from pushing prices up too quickly.
That’s created a bit of a paradox. We’ve got rising demand and rising supply at the same time, and it’s kind of holding the market in check.
Regional markets doing their own thing
It’s not the same story everywhere. In areas like the North West, Northern Ireland and Scotland—where homes are generally more affordable—house prices are rising at around 2–3% per year, which is stronger than the national average.
But in southern England, particularly in London and the South East, things are much flatter. That’s mostly down to increased listings in high-value areas—some postcodes have seen supply surge by up to 19%, making it tough for sellers to achieve premium prices. In fact, parts of central London have even seen minor price drops over the last year.
If you dig into Zoopla’s regional breakdown, you’ll spot that homes valued under £250,000 are where most of the annual growth is happening.
Lending tweaks have made a big difference
One of the key shifts this summer is the change in how lenders assess affordability. Borrowers can now access up to 20% more than they could just a few months ago—even if their income or outgoings haven’t changed. That’s a huge change, and it’s brought a lot of buyers back into the market.
Zoopla and other analysts believe this may explain the 11% rise in buyer demand and 8% increase in agreed sales over the past year. It’s activity-driven growth, rather than price-driven.
Even major outlets like The Guardian are noting how this lending shift has helped keep things moving, especially during the summer months when things often slow down.
What’s happening locally in Portsmouth, Southampton & surrounding areas?
If we zoom in on the South Coast—Portsmouth, Southampton, Fareham, Gosport, Stubbington—the national trends show up here too, but with a few quirks worth pointing out.
We’re seeing plenty of new listings across the region, especially in Portsmouth and Southampton. More choice for buyers, which is good—but it does mean sellers can’t be too ambitious on price. Properties that are priced realistically are still moving fairly quickly—typically under 6 weeks to secure an offer in central locations—but anything that’s even 5–10% overpriced tends to sit.
Southampton in particular has seen a lot of movement in the £220k–£300k range, especially among two-bed terraces and flats around the university and hospital catchments. First-time buyers are definitely active again, and small buy-to-let investors haven’t disappeared either—likely encouraged by the slightly more flexible mortgage rules that came in earlier this year.
In Portsmouth, demand is holding up best in PO4 and PO5. Family homes are getting more traction than flats, especially near the seafront or schools like Craneswater or Mayville. That said, flats around Gunwharf and Old Portsmouth still let well, especially furnished, so landlords there haven’t struggled—yet.
Across Fareham, Gosport, and Stubbington, it’s much more price-sensitive. Homes under £250,000 are still getting strong enquiries, particularly those with good parking or potential to extend. But higher-end stock? Bit of a slower burn. Viewings are happening, but buyers are negotiating harder—often coming in 5–10% under asking and testing the seller’s resolve.
If you’re a landlord in these areas, it’s a good time to be selective. Void periods remain low, but tenant expectations are climbing. More applicants are asking about energy efficiency, broadband speed, and even whether the landlord is “hands-on” or using a managing agent (weirdly common this year). A tidy listing, realistic rent, and quick replies to maintenance issues still go a long way.
Outlook for the rest of 2025? More of the same
While Zoopla initially predicted around 2% price growth for this year, they’ve now revised that down to closer to 1%. However, total sales volumes are still expected to beat last year’s figures by around 5%. So while capital growth is cooling off, the market itself isn’t sluggish.
As this summary points out, sellers who price realistically are still selling fast—but over 20% of listings are sitting unsold for six months or longer. It’s a market where presentation and accuracy matter more than ever.
Final thoughts
There’s no runaway boom, no dramatic crash—just a market finding its balance. Buyers have more breathing room, lenders are slightly more flexible, and sellers are having to be a bit sharper with pricing.
And if you’re a landlord or investor, this kind of environment—plenty of stock, slower inflation, better borrowing conditions—can actually work in your favour. Just depends on where and how you’re looking.