Several property experts have revised their predictions downward, with Savills lowering its 2025 forecast from 4 per cent to 1 per cent and Rightmove halving its prediction from 4 per cent to 2 per cent.
According to HM Land Registry data published in August, house prices rose by 3.7 per cent in the 12 months to June, with a monthly increase of 1.4 per cent.
The average UK property now stands at £269,000, (about $518,000 AUD) approximately £9,000 ($17,300 AUD) higher than a year ago.
Regional variations remain significant across the UK.
Scotland led growth among UK nations with a 5.9 per cent annual increase, followed by Northern Ireland at 5.5 per cent, England at 3.3 per cent, and Wales at 2.6 per cent.
Within England, the North East experienced the fastest growth at 7.8 per cent, while London lagged behind at just 0.8 per cent.
More recent data from major lenders shows slightly slower growth.
Both Halifax and Nationwide reported house prices rising by 2.4 per cent in the 12 months to July, with monthly increases of 0.4 per cent and 0.6 per cent respectively.
Amanda Bryden, head of mortgages at Halifax, said the market’s showing resilience despite ongoing challenges.
“Challenges remain for those looking to move up or onto the property ladder, but with mortgage rates continuing to ease and wages still rising, the picture on affordability is gradually improving,” she said.
The current market is characterised by a high supply of properties, giving buyers more negotiating power.
Rightmove data shows asking prices fell by 1.3 per cent in August, in line with the 10-year average for this time of year.
The average asking price now stands at £368,740, just 0.3 per cent higher than a year ago.
Looking beyond 2025, some experts anticipate stronger growth.
Savills forecasts 4 per cent growth in 2026, 6 per cent in both 2027 and 2028, and 5.5 per cent in 2029.
The estate agency expects wages to grow 22 per cent between 2025 and 2029, potentially boosting buyer confidence as mortgage conditions improve.
Changes to lending criteria are already making it easier for some buyers to enter the market.
Following encouragement from policymakers, some lenders are allowing mortgage customers to borrow more than previously permitted.
Nationwide reported that applicants can now borrow £28,000 more on average under the new rules.
