But tax uncertainty clouds outlook for autumn market
Activity in the UK housing market has continued to rise over the past year, with Zoopla’s latest House Price Index reporting a 5% increase in agreed sales.
Buyer demand has also grown by 4%, maintaining conditions that favour purchasers, though this varies by region.
Sellers preparing for the autumn period are being advised to set realistic asking prices, as ongoing speculation about property tax changes could temporarily affect homes valued above £500,000.
“There is plenty of demand for homes and more people are looking to move,” said Richard Donnell, executive director at Zoopla. “However, buyers also have much greater choice to choose from, especially across areas of southern England.”
House price growth slows
The rate of house price increases has moderated in recent months. Buyers now have a wider selection, with 10% more homes available compared to last year, while affordability remains a challenge, particularly in southern England.
Average house prices have risen by 1.3% over the past year, now standing at £270,600—£3,560 higher than a year ago. This annual growth is below the 2.1% seen at the start of 2025 but above the 0.6% recorded last year.
“We expect UK house price inflation to continue in a range of 1.5-2% over the rest of the year,” Donnell said. “There are signs that prices are firming in southern England but price growth is slowing across northern regions.”
Nathan Emerson, chief executive of industry body Propertymark, said stable house prices “are a welcome sign for groups such as first-time buyers, who can better take advantage of a period of steadiness.”
Speculation over property tax reforms prompts caution
Uncertainty over potential tax changes has become a concern for buyers. Reports have suggested the possible removal of stamp duty in favour of an annual property tax for homes over £500,000, and the introduction of capital gains tax for sellers of properties above £1.5 million. Such speculation may prompt some buyers to delay decisions ahead of the Autumn Budget.
Historically, tax policy changes have influenced market activity and buyer behaviour. About a third of homes currently for sale are priced above £500,000, with the effects most pronounced in London and the South East. While main residences are exempt from capital gains tax, second home owners and landlords may be affected if new measures are introduced. Only 4% of homes on the market are valued above £1.5 million, but potential changes could influence activity at this end of the market in the short term.
“It is vital that tax reform is conducted in a way that does not penalise aspiring homeowners with additional costs that hinder their chances of moving house,” Emerson said.
Regional disparities in sale times and price growth
The time it takes to sell a property remains a key indicator of market health. In the North West and North East, where supply is tighter and homes are more affordable, the average sale time in July was 27 days—23% faster than the national average of 35 days. These regions have also seen higher price growth, at 2.7% and 2.1% respectively.
In contrast, southern regions face a more pronounced buyer’s market, with increased supply and affordability constraints extending average sale times to 39 days, 11% longer than the national average. As a result, house price growth in the South East and South West is subdued, at just 0.3%.
Accurate pricing is critical. Properties that require a price reduction to attract buyers typically remain on the market 2.4 times longer than those priced correctly from the outset. This is in addition to the usual four to six months needed to complete a sale, subject to contract.
“There is a clear link between buyer choice and price inflation and how long it is taking homes to sell,” Donnell said. “Sellers need to understand local market conditions when considering how to market their home, setting the right price and how quickly they would like to sell. The risk of being too ambitious on price is your home taking more than twice as long to find a buyer - or not selling at all.”
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts, however, acknowledged that “it’s a real challenge to get pricing right at the moment with all the political talk around potential tax changes.”
“When a property is initially overpriced, it can sit for a while, but once the price comes down to where buyers feel it should be, it will sell,” she said. “That’s why we are still achieving sales in all price brackets, which does differ slightly from Zoopla’s national statistics – but that’s the nature of working in a small, highly specific market within a much larger one.”
According to Zoopla, the market remains on track for 5% more sales in 2025 at 1.15 million.
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