House Price Growth Slows Amid Rising Supply

House price growth is decelerating after a year of steady recovery, according to Zoopla’s latest House Price Index. Annual UK house price growth dipped to 1.8% in February from 1.9% in January and is expected to slow further. The average UK home now costs £267,500, up £4,750 from a year ago.

The slowdown is driven by a growing supply of homes outpacing sales. There are 11% more homes for sale than a year ago, while agreed sales are up just 5%, strengthening the buyers’ market. The average estate agent now has 33 properties listed, up from 29 last year. With spring typically accounting for 30% of new listings annually, supply is set to rise further.

Static mortgage rates (averaging 4.4% for a five-year fixed deal) and higher stamp duty from April are also weighing on demand. From April, 80% of home mover buyers and 40% of first-time buyers will face higher stamp duty, likely influencing offer prices.

Regional trends vary. In southern England, demand has increased but lags behind supply, keeping house price growth at 1% or lower in London, the South East, South West, and Eastern regions. House prices are falling in areas such as Dartford (-0.8%), Ipswich (-0.2%), and NW London (-0.1%). Additionally, 150 councils will soon double council tax on second homes, further boosting supply in areas like the South West, where Truro (-0.8%) and Torquay (-0.7%) are seeing price declines.

Slower house price growth as supply increases and stamp duty impacts the market.

Conversely, stronger demand in northern England, the Midlands, and Scotland is supporting faster price growth. Buyer demand is up 10% year-on-year, with slower supply growth driving above-average price increases—3% in the North West and 2.5% in Scotland. Prices are rising fastest in Motherwell (4.3%) and Kirkcaldy (3.8%) in Scotland, while Wigan (3.8%), Blackburn (3.7%), and Bradford (3.6%) are among the fastest-growing areas in northern England, where homes remain more affordable (£130,000–£220,000 vs. a national average of £267,500).

London is the only region where buyer demand has fallen (-3% year-on-year). Many first-time buyers rushed to purchase last year to avoid higher stamp duty, leading to a current slowdown. From April, 80% of London’s first-time buyers will face stamp duty, compared to less than half under current thresholds.

Richard Donnell, Zoopla’s Executive Director, expects a steady rise in sales agreements through 2025 as more sellers enter the market. However, with increased supply and higher stamp duty costs, house price growth will likely moderate further. He advises sellers to price realistically to attract buyers in a competitive market.

Disclaimer: The views expressed above are based on industry reports and related news stories and are for informational purposes only . SSIL does not guarantee the accuracy, legality, completeness, reliability of the information and or for that of subsequent links and shall not be held responsible for any action taken based on the published information.