Average house prices in England and Wales dropped by 0.6% in July 2025, marking the sixth consecutive monthly fall, according to the latest House Price Index from e.surv and Acadata.
At £353,300, prices are now 2.2% lower than a year ago, with the market still adjusting following April’s stamp duty changes and a rise in vendor listings.
Despite the ongoing decline, HMRC data shows transaction activity began to pick up in June, and the Bank of England’s cut to a 4.0% base rate could offer support to borrowers and improve market conditions heading into autumn.
Rob Owens, head of research at e.surv, said: “This week’s base rate cut may offer some relief to borrowers, particularly first-time buyers, but we don’t expect a significant change in mortgage rates in the short term. Lender caution and broader market conditions continue to weigh on affordability, especially in higher-priced regions like the South East and London.”
Southern England remains the biggest drag on the market, with the South East recording a 3.3% annual drop in prices and only a quarter of local areas showing growth. In contrast, Yorkshire and the Humber and the North East posted annual gains of 1.4% and 0.5% respectively.
Owens added: “Nonetheless, rising real incomes and improving sentiment suggest the market may be over the worst of its decline. With further rate cuts expected and no major policy interventions on the horizon, the second half of the year could offer a more stable footing.”
