UK House Prices Fall in July – Largest Drop in Over 20 Years

2025-07-23

According to Rightmove, the UK property market experienced its steepest July decline in average asking prices since 2002, signalling a potential turning point for buyers. The average asking price dropped by 1.2% (£4,531) this month, bringing it down to £373,739. This marks the most significant seasonal fall recorded since their data collection began, as reported by both Rightmove and Reuters.

Despite the drop, prices remain marginally above last year, showing a modest 0.1% annual increase.

Regional Performance

London led the monthly declines with a 1.5% fall, and inner London areas saw prices slide by 2.1%.
The South East, North West, and South West also recorded notable falls of around 1.1–1.2%.
In contrast, the North East of England experienced a positive monthly rise of 1.2%, highlighting regional divergence.

Contributing Factors

Several elements have contributed to this seasonal price dip:

Increased stock levels: More available homes on the market are giving buyers greater choice, forcing sellers to lower asking prices.
Seasonal slowdown: July is traditionally quieter due to school holidays, and this year’s effect has been more pronounced.
Stamp duty changes: The tapering of reliefs in April has impacted prime areas like London, especially for second home buyers and investors.

These findings come directly from Rightmove’s latest monthly House Price Index and are widely cited across UK property media including Financial Times, Estate Agent Today, and Property Industry Eye.

Market Remains Active

While prices are softening, demand remains surprisingly robust:

Buyer demand has risen by 6% year-on-year.
Sales agreed are up 5% compared to the same time in 2024.
The average 2-year mortgage rate has fallen from 5.34% to 4.53%, saving buyers around £150 per month on a typical purchase.

This combination of softer prices, falling mortgage rates, and strong demand means the market is adjusting rather than collapsing.

Rightmove Revises Forecast

In response to the ongoing trends, Rightmove has reduced its 2025 full-year growth forecast from +4% to +2%. The revision reflects growing stock levels and competitive pricing, particularly in southern England.

Looking ahead, further interest rate cuts by the Bank of England are anticipated later in the year, which could support greater affordability and confidence among buyers.

What This Means for Property Buyers

This is a pivotal time for anyone considering buying a home or investing in property. With:

Greater choice on the market
Falling mortgage rates
Motivated sellers pricing competitively
A revised, more realistic outlook on price growth

Buyers are now in a stronger position to secure favourable deals.

These conditions are especially significant in London, where premium postcodes like Notting Hill, Kensington, and Chelsea are seeing rare opportunities emerge.

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Source: This article includes insights from Rightmove’s House Price Index July 2025, as reported by Rightmove News, Reuters, and other major UK property news outlets.