UK House Sales Hit 4-Year High 

The number of house sales agreed surged in May 2025, bouncing back from a slump caused by the end of stamp duty relief. 

Data from Zoopla shows that 6% more sales were agreed in May 2025 compared to 12 months earlier. The increase in sales follows a series of Bank of England base rate reductions which have been carried over to mortgage interest rates, helping to improve mortgage affordability. 

In London, there was a 4% increase in year-on-year sales, whilst in the north west of England, sales increased by 14%. Areas where properties are more affordable have seen the biggest increases in sales agreed. 

The House Price Index also revealed that average UK house prices have grown 1.6% over the last year, with the average house price at £268,250 in May 2025. 

Property experts are anticipating an increase in buyer demand throughout the second half of 2025, primarily boosted by the availability of lower mortgage rates and relaxed affordability testing. 

Mortgage lenders have also been encouraged by the FCA to loosen mortgage affordability tests, with Santander one of the first major lenders to relax their affordability tests. With many homebuyers now able to borrow more, the move is helping first-time buyers get onto the property ladder. 

The key change in the affordability testing is that lenders are relaxing the affordability tests for whether a homeowner would be able to afford mortgages if interest rates were to increase. This is driven by increased confidence that interest rates will continue to fall.  

This is Money suggested that the base rate could fall to 3.5% by the end of 2025 and Oxford Economics have predicted a base rate of 2.5% in 2027. 

With some mortgage product interest rates recently dropping below 4% and the expectation of further decreases, house sales figures should continue to be strong in the second half of 2025 and beyond.