Rents also on upward trend
UK house prices and rents have continued to rise, with new government figures showing property values have increased across most regions in the year to February 2025.
Average house prices rose 5.4% to £268,000 over the 12-month period, up from a 4.8% increase in the year to January. Annual price growth has been trending upwards since bottoming out in December 2023, when prices had fallen by 2.7%.
England’s average house price reached £292,000 in February 2025, a rise of 5.3% or £15,000 compared to the same month last year. That was a faster increase than the 4.5% recorded in January. In Scotland, the average home was worth £186,000, marking a 5.7% increase from a year earlier. This represented an acceleration from the 5.3% rise in the previous month.
Wales recorded slower growth, with average prices up 4.1% to £207,000. That marked a drop from the 5.6% growth seen in January. Northern Ireland data, measured quarterly, showed prices rose 9% year-on-year in the fourth quarter of 2024, bringing the average to £183,000.
Among England’s regions, the North West had the highest annual inflation, at 8% in February — up from 6.9% in January. London saw the slowest growth, with prices up 1.7%, down slightly from the 2% recorded in January.
Average UK house prices increased by 5.4%, to £268,000 in the year to February 2025, up from 4.8% in the 12 months to January 2025.
— Office for National Statistics (ONS) (@ONS) April 16, 2025
Average UK private rents increased by 7.7% in the year to March 2025, this is down from 8.1% in February 2025.
➡️ https://t.co/ML1PXPMPpo pic.twitter.com/dhbEsTeKnr
“Today’s data underlines what a strong start to the year the property market had, with falling interest rates and the added motivation of completing deals before the higher stamp duty costs came into effect clearly working in tandem to boost demand,” said Tim Parkes (pictured left), chief executive of RAW Capital Partners, commenting on the latest ONS Private Rent and House Price data.
“The question was always going to be whether this price growth could be sustained into the spring – and there’s certainly an argument to be made that the current global economic uncertainty might actually drive interest in property investment. President Trump’s tariffs have reshaped the financial landscape and the impact on stocks and shares has been well documented.
“Could this prompt a flight to stability? If so, as today’s figures demonstrate, the UK property market could be a beneficiary, with bricks and mortar investments holding their appeal. At the same time, expectations that the Bank of England may need to cut interest rates – particularly if a trade war translates into a global recession – are already feeding into falling mortgage rates.”
For Kevin Roberts (pictured centre), managing director of mortgage services at Legal & General, the market is clearly heading in a positive direction.
“Our broker data shows that activity is picking up, especially among first-time buyers, with a 45% increase in mortgage searches for this group in Q1,” he said. “This year could see affordability improve further if the Bank of England cuts the base rate, as some expect. Lenders are already pricing in that possibility, which is good news for buyers and those looking to remortgage.”
Rents also rising
The average rent paid by UK tenants in March 2025 reached £1,332 per month, a 7.7% increase — or £96 more — than a year ago.
In England, the average rent was £1,386, up 7.8% annually. While that marks a slowdown from February’s 8.3% growth, it remains close to historic highs seen in late 2024.
Rents in Wales stood at £792, up 8.9%, while Scotland’s average reached £1,001 — an annual rise of 5.7%, slightly below the 5.8% increase seen in February. Scottish rent inflation has been moderating since peaking at 11.7% in August 2023.
Northern Ireland, now included in the UK-wide rent index, had an average rent of £838 in January 2025—up 8.2% from the previous year. While higher than the 8.1% rise seen in December, the pace has eased from the record 9.9% jump in April 2024.
“The rental market remains under significant pressure, with demand continuing to outstrip supply,” said Alex Upton (pictured right), managing director of specialist mortgages and bridging at Hampshire Trust Bank. “Letting agents are managing multiple applicants for every available property. While stock levels have seen some movement, competition remains fierce. Until that imbalance shifts, rental prices will continue to rise.”
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