Annual figures show both house prices and rents across the UK are rising more slowly, with experts warning that affordability pressures are weighing heavily on households.
According to the latest data from the Office for National Statistics (ONS), the average house price across the UK rose by 2.8% in the 12 months to July 2025. This marks a slowdown from the 3.6% growth recorded in the year to June.
The ONS reported that the typical UK home now costs around £270,000. While values are still climbing, the pace of growth has eased, reflecting wider pressures on the housing market.
Looking at regional figures, average house prices in England reached £292,000 in July, representing a 2.7% annual increase. In Wales, prices rose to £209,000, up 2% year-on-year, while in Scotland, the average stood at £192,000, showing a 3.3% rise.
Northern Ireland recorded one of the strongest increases, with average house prices reaching £185,000 in the second quarter of 2025. This was 5.5% higher than the same period last year.
Within England, the ONS highlighted strong regional differences. The North East saw the fastest annual growth at 7.9%, while London recorded the weakest at just 0.7%, underlining the capital’s cooling market.
Rents have also been rising but at a slower pace. The ONS said the average monthly private rent across the UK reached £1,348 in August. This was £73 higher than a year earlier, representing a 5.7% increase. However, this was slightly lower than the 5.9% rise seen in the year to July.
Breaking it down further, the average rent in England stood at £1,403 in August, up 5.8% compared to the same time last year. This increase was smaller than the 6% rise recorded in July and marked the ninth consecutive month of slowing rental inflation.
In Wales, average rents rose to £811 per month, up 7.8% (£59) over the year. While still a notable jump, it was slightly below the 7.9% rise recorded in the 12 months to July 2025.
Scotland saw slower growth, with average rents reaching £1,002 in August, up 3.5% (£34) year-on-year. This was the lowest annual rise in more than three years, following a steady decline since the record 11.7% annual increase in August 2023.
The most recent data for Northern Ireland showed average rents at £860 in June, which was 7.2% higher than a year earlier. This figure was slightly down from the 7.4% increase recorded in May 2025, reflecting the broader trend of easing rental inflation.
Like Scotland, Northern Ireland has also seen inflation cooling after previous record highs. Annual rent increases peaked at 9.9% in April 2024 but have been moderating since.
Commenting on the figures, Richard Donnell, executive director at Zoopla, said the slowdown was being driven by weaker demand. “Rents and house prices are slowing across the UK as housing demand cools and affordability pressures bite on what people can pay for rent and mortgages,” he said.
Donnell added that the trend could have wider consequences for the housing sector. He warned that weaker demand was likely to deter investment in new home building, potentially restricting future supply.
The ONS data was released alongside figures showing consumer inflation remained unchanged in August. The Consumer Prices Index (CPI) held steady at 3.8%, the same rate as in July. Economists, however, expect overall CPI and food inflation to rise again later this year, adding further strain on households.
Download NOW
4 Simple Steps To Becoming Wealthy Through Property