House prices have increased by £10,174 over the past year, with the typical home gaining more than £3,000 in value in 2025, according to the latest figures from Nationwide Building Society.
The average property is now valued at £271,316, compared to £261,142 this time last year, reflecting a 3.9 per cent rise. This is consistent with the annual house price inflation recorded in February 2025.
This steady increase indicates that property prices are approaching the all-time peak recorded by Britain’s largest mutual society. Prices reached £273,751 in August 2022 before the mini-budget the following month, which led to higher mortgage costs and negatively impacted the property market.
However, property prices have rebounded significantly since then, with values dipping to £257,656 in January 2024, and increasing by 5.3 per cent since that time.
On a monthly basis, house prices remained relatively flat, as many buyers’ hopes of completing their purchase before today’s stamp duty rise faded, according to the latest data from Britain’s largest mutual society, Nationwide Building Society.
On a non-adjusted basis, the average house price rose marginally from £270,493 in February to £271,316 in March. While this increase is modest, it highlights the continued stability of the market despite the looming changes to stamp duty.
Robert Gardner, Chief Economist at Nationwide, commented that the results were not unexpected, particularly given the imminent end of the stamp duty holiday. He noted that, while the housing market remained relatively stable, it was evident that many buyers were aware of the upcoming stamp duty change and made their decisions with this in mind.
Nationwide’s figures are based on mortgages approved in March, and Gardner highlighted that these deals would have been made with the understanding that the sale was very unlikely to complete before the new stamp duty regulations took effect.
From 1 April, the government will implement a significant change in stamp duty regulations. Purchasers who are not first-time buyers will begin paying stamp duty on properties costing more than £125,000, down from a previous threshold of £250,000. This adjustment means that a property purchase of £250,000 will now incur an extra £2,500 in upfront taxes, potentially affecting the affordability of homes for many buyers.
This shift in stamp duty rates marks an important moment in the housing market, with potential implications for both demand and pricing in the months ahead. As buyers rush to complete deals before the new rules are enforced, it remains to be seen how the market will respond in the wake of the changes.
First-time buyers are set to feel the full impact of the stamp duty changes, which were introduced on 1 April. Previously, first-time buyers were exempt from paying stamp duty on homes worth up to £425,000. However, this threshold has now been reduced to £300,000.
As a result of the change, first-time buyers purchasing a property worth £425,000 will now face a stamp duty bill of £6,205, where they would have previously paid nothing. This marks a significant adjustment for many, particularly in areas where property prices are close to or exceed the new £300,000 threshold.
Robert Gardner, Nationwide’s Chief Economist, suggests that the housing market could experience a temporary lull in the wake of these changes. He believes that the market may soften in the coming months, as many buyers likely rushed to complete their purchases before the new stamp duty rates came into effect.
“The market is likely to remain a little soft in the coming months since activity will have been brought forward to avoid the additional tax obligations – a pattern typically observed in the wake of the end of stamp duty holidays,” said Gardner.
Despite this potential slowdown, Gardner remains optimistic about the market’s recovery later in the year. He expects activity to pick up again as the summer progresses, although he acknowledges the uncertainty caused by broader global economic factors.
“Nevertheless, activity is likely to pick up steadily as the summer progresses, despite wider economic uncertainties in the global economy. The underlying conditions for potential homebuyers in the UK remain supportive,” he explained.
Gardner highlighted several factors that are expected to help bolster the housing market in the longer term. These include the UK’s low unemployment rate, rising earnings, and strong household balance sheets. He also pointed out that borrowing costs are likely to moderate somewhat if interest rates are lowered, as many analysts, including Gardner himself, anticipate in the coming months.
These supportive conditions suggest that, while there may be a temporary dip in activity due to the stamp duty changes, the market has the potential to recover and remain stable throughout the year.
Tom Bill, head of UK residential research at Knight Frank, also weighed in on the impact of the stamp duty changes. However, his outlook on the market’s recovery is slightly more cautious compared to some of his peers.
According to Bill, house prices were largely supported by the stamp duty deadline in the first quarter of the year. However, he anticipates a slowdown in activity now that the deadline has passed, as demand readjusts to the new market conditions.
“House prices were supported by the stamp duty deadline in the first quarter of the year, but we expect a dip in activity as demand effectively resets from April,” he explained.
While the market is expected to slow in the short term, Bill highlighted a key factor that could influence house prices going forward—an increase in supply. With more properties available, buyers re-entering the market will likely find greater choice, which could prevent house prices from rising too sharply.
“Buyers coming back into the market with a re-levelled playing field will find that supply is strong, which should keep downwards pressure on prices,” he added.
Despite expectations of a market rebound later in the year, Bill warned that external factors could still impact borrowing costs. He pointed to uncertainties surrounding US trade policy, which could affect economic conditions, and the inflationary impact of recent employer national insurance changes as potential challenges that might keep interest rates elevated for a longer period.
“Activity should recover by the summer, but borrowing costs could be held higher for longer by erratic US trade policy and the inflationary impact of measures like the employer national insurance changes,” he noted.
Overall, while the market is likely to regain momentum later in the year, Bill’s analysis suggests that affordability and economic uncertainty could play a significant role in shaping housing trends in the months ahead.
Where house prices are rising the most and least
Northern Ireland is experiencing a significant house price boom, with annual growth reaching 13.5% compared to the previous year. This makes it the strongest-performing region in the UK in terms of house price increases.
Scotland has also seen a notable rise, with house prices increasing by 3.9% year-on-year. Wales follows closely behind, recording an annual increase of 3.6%.
In England, property prices have risen by an average of 3.3% over the past year, according to Nationwide. However, the long-standing north-south divide in house price performance remains evident. Northern England continues to outperform the south, with prices in the north rising by 4.9% year-on-year.
Among English regions, the North West has emerged as the best performer, registering a 5.9% annual increase in house prices. In contrast, London saw a much smaller rise of just 1.9%, while East Anglia recorded a modest 2.1% increase.
Jonathan Hopper, chief executive of buying agents Garrington Property Finders, believes this trend is unlikely to change anytime soon. He attributes the stark contrast in price growth to an oversupply of properties in more expensive southern areas, which has given buyers greater negotiating power.
“In many more expensive, and often highly desirable, areas, a flood of supply has given buyers huge choice and negotiating power – and this has kept price inflation down,” said Hopper.
He highlighted that the disparity in growth is particularly striking when comparing Northern Ireland and London. “This is why average prices in Northern Ireland surged seven times faster over the past year than they did in London,” he noted.
Within England, Hopper points out that the gap between the north and south is continuing to widen. “The north-south divide is getting wider, with average prices in the north growing twice as fast as they are in the south,” he explained.
He also noted that much of the south of England has become a buyer’s market, where buyers have the upper hand in negotiations. “Across much of the south, we’re seeing a buyers’ market in which buyers can ask for, and achieve, discounts off the asking price. Sellers are having to price very competitively to attract interest,” he added.
This trend suggests that while northern regions continue to experience strong growth, the property market in the south remains more subdued, with sellers facing greater pressure to adjust prices to secure sales.
Download NOW
4 Simple Steps To Becoming Wealthy Through Property