Zoopla’s House Price Index showed there were 10% more homes for buyers to choose from, resulting in house price inflation slowing from 2.1% at the start of this year. However, July’s growth rate in 2025 was stronger than last year, when it was 0.6%.
The firm said house prices were rising slower than earnings, which were at 4.7%, boosting affordability.
The housing market is also busier than it was last year, with a 5% rise in agreed sales. There has been a slight dip in buyer demand over the summer, but it is still running 4% higher than last year, Zoopla said.
Faster house price growth in the North
Zoopla’s data showed that house prices were rising at a quicker pace in the North than the South.
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Northern Ireland saw year-on-year house price growth of 7.4%, while in Scotland, prices were up by 2.1%. In the Northern regions of England, house prices have risen by around 2%.
This is despite a 1% fall in housing supply in Scotland and a 4% decline in Northern England. Zoopla said that with fewer homes available, buyer competition was pushing house prices up.
Meanwhile, Southern England saw the slowest price growth, averaging 0.4% annually. This has coincided with an 18% rise in housing supply in London, and 12% across the South East and South West.
Proposed tax changes impact on the market
Jeremy Leaf, North London estate agent and a former Royal Institution of Chartered Surveyors (RICS) chair, said: “The market inevitably lost a little steam over the summer period, with so many decision-makers away and listings continuing to pile up.
“Nevertheless, quality replaced quantity, as we noticed agreed sales holding up well with little or no renegotiation, although did take a little longer.
“Unfortunately, perhaps the government do not appreciate that even rumours of a new property tax can have a detrimental impact on housing market confidence and activity, which we certainly witnessed ‘on the ground’ since the story broke last week.”
Amy Reynolds, head of sales at Antony Roberts, said: “We are seeing a lot of price reductions, and those reductions do lead to sales.
“It’s a real challenge to get pricing right at the moment with all the political talk around potential tax changes, as well as the significant amount of stamp duty buyers face. London is very different to the rest of the country, and even within London, we have micro markets.”
She added: “Here, the mid-range market is still healthy, whereas it’s tougher at the first-time buyer level and at the very top end.
“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. 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.”
