Is it an Opportunity for Buyers or an Unsettled Market?

Published by Elowen Homes | Property Management & Investment Specialists

UK Property Prices: What Has Changed Since last year 2025?

Since 2025, the UK property market has experienced a period of adjustment rather than a dramatic downturn. According to data published by major mortgage lenders and banking institutions such as Nationwide, Halifax, and UK Finance, average house prices have softened slightly across parts of the UK, particularly in London and the South East.

Several lender indices reported:

• Minor month-on-month price reductions at the end of 2025

• Slower annual price growth compared to previous years

• Increased price sensitivity among buyers

This cooling followed prolonged affordability pressures, higher interest rates earlier in the year, and cautious consumer sentiment.

Are Prices Falling or Stabilising?

While headlines often reference “falling prices”, the reality is more nuanced. Nationally, property values have largely flattened, with some regional dips rather than a widespread decline.

Mortgage lender statistics show:

• Annual price growth slowing to low single digits

• Regional variation, with stronger resilience outside London

• Asking prices stabilising into early 2026

In short, the market has reset from rapid growth to a more balanced position.

What Is Driving This Shift?

📉 Affordability Pressures

Higher borrowing costs reduced purchasing power throughout 2025. Although mortgage rates have started to ease, many buyers delayed decisions while waiting for clearer economic signals.

🏡 Regional Differences

London and commuter regions saw the most pronounced softening, while the Midlands and North of England remained comparatively stable due to stronger rental demand and affordability.

💷 Mortgage Market Changes

Banks and lenders have gradually reintroduced competitive mortgage products, improving buyer confidence and bringing cautious demand back into the market.

🧠 Buyer Psychology

Uncertainty around inflation, interest rates, and regulation led many buyers to adopt a “wait-and-see” approach late in 2025, contributing to price stagnation rather than sharp decline.

Does This Encourage Buyers?

For Owner-Occupiers

Yes—selectively. Buyers now face:

• Less competitive bidding

• Greater negotiating power

• More realistic pricing from sellers

For those with secure finances, this period offers opportunities that were limited during peak market conditions.

For Landlords and Investors

Softened pricing can create improved entry points, particularly where rental demand remains strong. With rents still elevated in many regions, yields can be attractive when purchases are well-aligned with local demand.

Or Is the Market Still Unsettled?

The market remains cautious, but not unstable. Rather than volatility, we are seeing:

• Slower transaction volumes

• More considered decision-making

• Price sensitivity replacing speculation

This reflects a transition toward a more sustainable and affordability-led housing market.

Elowen Homes Insight

At Elowen Homes, we view the current market as one of measured opportunity. Price adjustments since December 2025 have helped rebalance buyer and seller expectations, creating space for informed negotiation and long-term planning.

For buyers and investors willing to focus on fundamentals—location, demand, and long-term value—the market presents real potential. Meanwhile, landlords continue to benefit from strong tenant demand, making strategic acquisitions particularly relevant in today’s climate.

If you are considering buying, investing, or reviewing your property strategy, our team can provide tailored advice based on current market conditions.