House prices continued to increase in April, although the pace of growth has slowed compared to what is typically seen during the spring season. According to the latest data from Rightmove, the average asking price rose by 0.8%, adding £2,929 to reach £373,971.
While this marks another month of growth, it falls below the usual seasonal rise of around 1.2%, suggesting that current market conditions are beginning to limit how quickly prices can climb.
A softer spring uplift
Spring is traditionally one of the busiest periods for the housing market, often bringing stronger price increases as buyer activity picks up. However, this year’s more modest rise reflects a shift in market dynamics.
Higher mortgage rates and economic uncertainty are influencing buyer behaviour, leading to a more cautious approach. As a result, while prices are still moving upwards, the rate of growth is not as strong as in previous years.
Increased supply adds pressure on sellers
One of the key factors shaping the current market is the sharp rise in housing supply. The number of properties available for sale is now at its highest level for this time of year in more than a decade.
This increase in supply is creating stronger competition among sellers. With more choice available, buyers are taking their time and comparing options more carefully.
As a result, sellers are under greater pressure to price their homes realistically in order to attract interest and secure a sale. Overpricing can lead to properties sitting on the market for longer periods.
Larger homes lead price growth
The rise in house prices is not evenly spread across all property types. Larger homes, particularly those with four bedrooms or more, are driving much of the current growth.
These properties tend to be less affected by rising mortgage rates, as buyers in this segment may have higher deposits or rely less on borrowing. This gives them more flexibility compared to those purchasing smaller or more affordable homes.
In contrast, parts of the market that are more sensitive to borrowing costs—such as first-time buyer properties—are seeing slower price growth.
Regional differences become more noticeable
Regional variations are also playing a significant role in shaping the market. Scotland, for example, has shown stronger performance compared to other areas, with average prices rising by more than 4%.
Lower property prices and quicker transaction times are helping to support activity in this region, making it more resilient despite wider market challenges.
Elsewhere across Great Britain, price growth is more subdued, particularly in areas where affordability pressures are more pronounced.
Buyer demand continues to weaken
Despite the increase in house prices, buyer demand has softened. Data shows that enquiries to estate agents are running around 7% lower than the same period last year.
This trend has been consistent over recent months, with February and March also recording similar year-on-year declines.
Sales agreed are also slightly behind, coming in around 3% lower than last year. While this does not indicate a sharp downturn, it does reflect a more measured and cautious market.
More listings but slower activity
The number of new properties coming onto the market is only slightly lower than last year, but still significantly higher than in 2024.
This means that while demand has dipped, supply remains relatively strong, contributing to a more balanced market overall.
Buyers now have more options available, which reduces urgency and allows for more negotiation.
Signs of improving affordability
There are some positive signs when it comes to affordability. Wage growth has risen by around 3.9% over the past year, which is helping to offset some of the impact of higher house prices.
At the same time, asking prices are slightly lower compared to a year ago, which may make it easier for some buyers to enter the market.
Lenders have also made adjustments to their criteria, allowing some borrowers to access larger loans. This has provided additional support, particularly for those who may have struggled to secure financing previously.
First-time buyers remain cautious
First-time buyer demand has also declined, although at a slightly slower pace than the wider market. Activity in this segment is down by around 6% year-on-year.
Rising mortgage rates continue to be a key challenge for this group, as affordability remains a major concern. However, the smaller drop in demand suggests that many first-time buyers are still actively trying to enter the market despite the challenges.
Mortgage rates continue to shape the market
Mortgage costs remain one of the most influential factors affecting the housing market. The average two-year fixed rate has climbed to around 5.42%, up from approximately 4.25% before recent geopolitical tensions.
Higher borrowing costs are making buyers more cautious, particularly when it comes to budgeting and long-term affordability. This is contributing to the slower pace of market activity.
A more cautious market environment
Industry experts suggest that the current slowdown in demand does not reflect a collapse in confidence, but rather a shift towards more careful decision-making.
Buyers are taking more time to assess their options, while sellers are adjusting expectations to reflect changing market conditions.
This has created a more measured and balanced market, where both sides are approaching transactions with greater caution.
Outlook for the months ahead
Looking ahead, the housing market is expected to remain steady, though subdued. The combination of higher mortgage rates, increased supply, and economic uncertainty is likely to keep price growth under control in the near term.
At the same time, underlying demand and seasonal activity should help prevent any sharp declines in prices.
Overall, the market appears to be entering a phase where realistic pricing, flexibility, and careful planning will be key for both buyers and sellers.
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