The UK housing market experienced its busiest May since the 2021 pandemic boom, according to Zoopla’s latest House Price Index (HPI). The number of sales agreed surged to a four-year high, fuelled by improved mortgage affordability, competitive lending rates, and a significant increase in the number of homes on the market. A key driver behind the market’s resurgence is the availability of better mortgage deals. Following a challenging few years where mortgage rates climbed as high as 6% in 2022 and 2023, a shift in the mortgage landscape in 2025 has seen rates fall, unlocking greater affordability for many buyers. Changes to affordability checks have also had a notable impact, enabling homebuyers to borrow up to 20% more than they could earlier in the year. These improvements have translated into increased housing activity. Sales agreed in May 2025 were 6% higher than in the same month last year, with total stock levels rising by 13% year-on-year.
UK Housing Market Trends: House Prices Inch Up, but Sellers Must Stay Realistic
The average UK house price rose 1.6% over the past year, reaching £268,250, an increase of £4,330. However, with more competition among sellers, pricing realistically remains crucial. On average, homes are selling for 3% (£16,000) below asking price, a trend that has remained stable in recent months.
Regional Trends: North West Leads in House Price Growth
The North West emerged as the UK’s hottest property market, with cities like Blackburn and Belfast seeing annual price growth of 5.8% and 6.1%, respectively. Manchester and Liverpool followed closely, posting increases of 2.5% and 3%. Other standout locations include Wigan (4.4%) and Birkenhead (4.1%).
Despite strong price growth, the North West saw just a 3% rise in homes for sale compared to last year, significantly below the national average. In contrast, housing stock increased by 21% in the South West, 17% in London, and 15% in the South East, indicating growing selling activity in southern regions.
Homeownership Now a Bigger Priority Than Marriage
New research by Zoopla has highlighted a cultural shift in financial priorities, especially among younger adults. Nearly half (48%) of renters in a relationship are currently saving for a home, while only 8% are setting money aside for a wedding. Among Generation Z, 59% identified buying a home as their top financial goal, with just 6% prioritising saving for marriage. The changing landscape of homeownership affordability has led many to delay or scale back wedding plans, 21% said they would postpone marriage to afford a home, and 37% are considering more budget-conscious weddings to prioritise property ownership.
Affordability Crisis: First-Time Buyers Struggle with Deposits
The average first-time buyer (FTB) home in the UK now costs £259,700, requiring a typical deposit of £56,700. However, widespread misconceptions about deposit requirements persist. Most prospective buyers believe they only need to save £27,600, less than half the actual amount. The gap is particularly stark in London, where the average deposit is £138,800, yet buyers expect to save just £39,800.
Affordability remains a major barrier to homeownership. In the South of England, homes in 8 out of 10 towns are valued at more than four times the average annual income. As a result, just 34% of people in the South think buying a home in the next five years is realistic, compared to 43% in the North. Nationally, 73% of respondents said house prices make it harder to save, with the figure rising to 77% in the West Midlands and a staggering 82% in London. Among millennials, only 9% believe they could afford to buy in their local area.
Financial Pressure Causing Relationship Strain
The emotional toll of property buying is also becoming clear. Nearly half (49%) of couples reported that financial pressures related to buying a home had caused arguments. The need to make difficult financial trade-offs, such as choosing between a deposit or a wedding, is now a widespread reality for many UK households.
Key Takeaways from a Mortgage Expert
Commenting on the data released by Zoopla on house prices and home ownership, Marketing and Communication Director at Oportfolio Mortgages Louis Mason said:
“The latest data shows a clear resurgence in buyer confidence, driven by more competitive mortgage deals and relaxed affordability checks. At Oportfolio Mortgages, we’re definitely seeing a real shift in how people are prioritising homeownership, especially among younger buyers who are increasingly choosing to invest in property over other life milestones like marriage. Traditional life events like that (which can often costs thousands of pounds) are not as popular as they once were, and people would much rather invest the money in an asset like a property. While the rise in listings is welcome news for buyers, it’s crucial that sellers price realistically in a more competitive market. With the average first-time buyer still underestimating deposit requirements, expert mortgage advice has never been more important to help navigate the true cost of buying a home.”
Speak To a Mortgage Expert
Whether you’re a first-time buyer, a seller, or looking to remortgage, staying informed about current housing and mortgage trends is crucial. With the market shifting rapidly, expert mortgage advice and careful financial planning can make all the difference in successfully navigating the UK property landscape. If you are looking to purchase a property in 2025 or beyond, please feel free to give our team of mortgage advisors a call today. We are here to help.
