New Price Highs Amid Softer Demand and Improved Buyer Conditions

May 2025 Market Overview

The UK property market has reached another milestone, with the average asking price now standing at £379,517, a modest monthly rise of 0.6% (+£2,335). Though this marks a new record, it also represents the smallest increase for May since 2016, suggesting a more measured market shaped by increased supply and a more discerning buyer base.

Supply Strengthens Buyer Position

We are now seeing the highest level of available stock in over a decade, a key shift that’s giving purchasers greater choice and negotiating power. Following an active March, driven in part by changes to stamp duty, April saw a 4% year-on-year decline in buyer demand. However, this was balanced by a 14% increase in new listings, pointing to ongoing seller confidence and an active spring market.

Prime Central London – Undervalued by Historical Standards

In Prime Central London, values remain substantially below previous highs. Prices are currently 21.2% below their 2014 peak, or 42.3% lower in real terms when adjusted for inflation. For investors and long-term buyers, this represents a window of value in one of the world’s most prestigious residential markets.

Underlying Demand Remains Resilient

Despite a short-term easing in activity, the broader trend is encouraging. Buyer demand remains 3% ahead of 2024, and agreed sales are 5% higher than at this point last year, particularly where properties are priced in line with market expectations.

While the pace of growth may be softening, the fundamentals remain strong. With more choice, stable pricing, and the potential for further interest rate cuts on the horizon, London continues to offer compelling conditions for both buyers and sellers navigating today’s evolving market.