UK house price growth slows in July as north outperforms south

Annual UK house price growth slowed in July, driven by weaker gains in higher-priced regions even as several northern areas continued to record stronger rises, official data from the Office for National Statistics showed.

The ONS said the annual rate of growth eased to 2.8% in July from 3.6% in June, meaning the typical home was about £8,000 more expensive than a year earlier. The figures are based on sold prices, which reflect transactions agreed in the months before publication.

Regionally, much of the year-on-year growth was concentrated in more affordable parts of the country. The North East reported the strongest rise, with average prices up 7.9% in the 12 months to July to a mean of £163,684. The North West saw prices increase 4.8%, while Yorkshire and the Humber were up 3.9%.

By contrast, prices in pricier regions barely moved. London recorded a 0.7% annual rise, with the average home in the capital fetching £561,587. The South East and South West reported annual increases of 1.2% and 1.4% respectively. The ONS also noted that monthly growth in July appeared to stall even in the faster-growing regions.

"On an annual basis, prices in North East England are still growing 10 times faster than those in London, but in July both regions recorded the same rate of growth — zero," said Jonathan Hopper, chief executive of buying agent Garrington Property Finders.

Property-type differences were also apparent. Detached and semi-detached houses rose by 3.6% year on year, while flats and maisonettes were up just 0.7%. Data from estate agent Hamptons, shared with This is Money, indicated that a growing share of flat sellers are selling for less than they paid: 22% of flats sold in 2025 to date fetched lower prices than their purchase price, more than double the rate across the wider market. Analytics firm Property Data found that 24% of flats sold in London between October 2024 and June 2025 were sold at a loss relative to their purchase price.

New-build prices have shown sizeable volatility. After a 7.7% increase in the year to May, the average price paid for new builds in England fell 3.9% in May compared with April. "Nowhere is the cooling sharper than with new build homes," Hopper said, adding that month-to-month volatility reflects patchy supply as developers build less and growing buyer wariness over paying premiums for brand-new properties.

Market forecasters have revised down expectations for the coming months. Knight Frank this week cut its forecast for UK house price growth to 1% for the year, from a 3.5% projection made four months earlier. Tom Bill, head of UK residential research at Knight Frank, attributed the downgrade to a combination of higher supply and weaker demand.

"Supply has been boosted by an overhang of property since April’s stamp duty cliff edge and the fact more landlords are selling due to the Renters Rights Bill," Bill said. He added that stable mortgage rates have supported demand but that a general mood of economic uncertainty — set to intensify as the November Budget approaches — has made some buyers cautious.

The ONS dataset and the separate industry analyses point to a market that is becoming more geographically uneven and more sensitive to product type and new-build premiums. With increased supply in some segments and wavering buyer confidence, analysts say price growth is likely to remain subdued in the near term.