UK July house prices fall 1.2% m/m Rightmove

UK July house prices fall 1.2% m/m Rightmove

UK house prices experienced a notable decline in July 2025, falling by 1.2% month-over-month, according to Rightmove. This decrease follows a period of steady growth, with house prices increasing by 3.9% year-over-year in May 2025. The latest figures from Rightmove indicate that the average house price in the UK stood at £269,000 in May 2025, but this figure has since fallen to £265,000 in July 2025.

The decline in house prices can be attributed to several factors. Firstly, the recent changes to Stamp Duty Land Tax (SDLT) in April 2025 may have contributed to a temporary slowdown in property transactions, as buyers adjusted to the new rates. Secondly, the ongoing economic uncertainty and interest rate increases have made mortgage affordability more challenging for potential buyers. Additionally, the cooling demand from first-time buyers, who are often more sensitive to price changes, may have played a role in the recent price decline.

Despite the monthly decline, the overall trend remains positive, with house prices up 3.9% year-over-year in May 2025. This growth rate is higher than the annual inflation rate of 6.7% for private rents, suggesting that housing remains an attractive investment compared to rental properties. However, investors should remain vigilant, as the market is subject to various economic and political factors that can influence price movements.

In terms of regional performance, the North East continues to lead in house price growth, with an annual inflation rate of 6.3% in May 2025. Conversely, the South West experienced the lowest annual house price inflation rate of 1.9% in the same period. London's house price annual inflation rate was 2.2% in May 2025, down from 4.6% in April 2025.

Private rents also experienced a slowdown in annual inflation, with the average UK monthly private rent increasing by 6.7% in the 12 months to June 2025. This rate is down from 7.0% in the 12 months to May 2025, representing the sixth consecutive month of slowing annual inflation. The average rent in England was £1,399 in June 2025, up 6.7% from a year earlier, while in Wales, the average rent was £804, up 8.2% from a year earlier.

Investors and financial professionals should monitor the ongoing trends in both house prices and rents, as these factors can significantly impact investment decisions. The UK housing market remains dynamic and subject to various influences, requiring a nuanced approach to analysis and investment strategies.

References:
[1] https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/privaterentandhousepricesuk/july2025
[2] https://www.rightmove.co.uk/news/uk-house-prices-fall-1-2-mom-july-2025/