Zoopla revealed that the inflation rate of home prices in the UK, a year ago, was 1.9% at the end of January.
Zoopla’s latest data found that agreed sales volumes were 10% higher than a year ago, while homes sold were 11%, meaning there were more buyers in the market.
House price inflation continues to follow the North-South gap. The average price in Northern Ireland is 7.2% and 3% higher in the northwest.
By comparison, house prices in London and southern England are only 1% to 1.2% higher than last year.
In January, house price inflation stagnated or slowed in most parts of the UK and countries.
This reflects a sharp decline in consumer confidence following the 2024 fall budget, with mortgage rates rising by 0.5% since September 2024.
Zoopla found that in early 2025, the trend emerged was a 14% increase in the number of apartments on the market and a 5% increase in the number of homes for sale.
Over the past five years, the average price of apartments has risen by only 7%, while the price of homes has risen by 24%.
The gap between the prices of houses and apartments is 30 years, as the average price of a house (£319,500) is 67% higher than the flat average (£191,300).
While the apartment looks like it’s worth the money, buyers are still prioritizing the home. Zoopla data shows that in 2017, one in five (44%) of first-time buyers want to buy outside
London wants a three-bed house.
In major UK cities, monthly mortgage repayments for apartments are 43% lower than rental costs, while mortgages for homes are 22% higher.
Zoopla said the housing market is still resilient and more people are hoping to move in 2025 and 2026 than last year.
Last year, average revenue grew 6%, far ahead of inflation, which supports buyer confidence and helps reset affordability.
“There is a considerable increase in the number of homes for sale early this year, which provides buyers with greater options and stronger negotiating capabilities,” Zoopla said in the report.
“Apart from the high stamp duty costs for many people since April, we expect home price inflation to remain at 2-2.5%, growing above average in cheaper markets outside of southern England.”
“The real estate market has become increasingly strong to strength, and sales and buyer demand continues to trend this month,” commented Sara Palmer, director of distribution at mortgage lenders.
“This is partly due to the recent reduction in base interest rates, which has sparked expectations that 2025 will cut further. We have seen some high street lenders offer rates below 4%, which shows confidence in the real estate market.”
“Most importantly, the stamp duty deadline is approaching quickly, prompting first-time home buyers to tie their property plans by March, contributing to strong activity and inflated prices this month.”
“Looking forward with the spring statement, the government announced further support for first-time buyers, especially as there are great measures to help the organization climb the property ladder. However, this must responsibly protect borrowers from overstretching.
“First-time home buyers are completing their purchases ahead of the April stamp duty change, and today’s figures do hammer the home. But even with an 11% increase in homes in the market, there is pressure to supply new homes.”
“The last time the UK built enough homes was in 1979, when social housing was a priority. We have been lacking since then. Proposing changes to affordability testing, such as including rent payments, could help more buyers enter the market, but it is also possible to increase demand without enough homes to meet them.”
“It’s clear that the government is serious about supply issues – they articulated the stalls last summer with a 1.5 million home target. But it’s not just about building more homes. If we’re going to solve supply issues, we need to go beyond traditional new buildings and explore alternative ways to get to home ownership.”
“For example, there is great potential to repurpose underutilized commercial buildings in urban centers to better utilize the space already present, while our research shows that 64% of young people aged 18 to 24 have been considered for customization or self-building projects. Both provide a valuable opportunity for brokers and lenders to expand their business and support borrowers in a professional corner of this market.”
Propertyymark CEO Nathan Emerson added: “With the stamp duty change in England and Northern Ireland, effective from April, we are seeing many people finish their acumen as quickly as possible, usually saving around £2,500 when buying a regular pricing property.”
“The scale of housing price increases will usually vary in different parts of the UK; however, with inflation at a higher rate of 3%, we may see such decisions that affect base rates in the coming months to help maintain overall stability in the economy.”
“With a growing population, all decentralized governments must not only turn their attention to ensuring that housing construction goals need to be achieved in areas where they are needed, but also that the right type of housing is established, which is consistent with the shift in buyer’s behavior.”
