House prices post second consecutive quarter of growth this year
The latest Property Market Index Review by London lettings and estate agent, Benham and Reeves, has revealed that the property market has continued to demonstrate resilience in 2025, with house prices increasing for a second consecutive quarter in Q2, following four consecutive quarterly increases seen in 2024.
The Benham and Reeves Property Market Index Review* is a quarterly accumulation of house price data from the top four existing indices, providing the most comprehensive view of UK and London house price performance. It looks at where the average house price sits overall when taking into account mortgage approved house prices from Halifax and Nationwide, seller expectations via the Rightmove House Price Index, and sold prices from the UK House Price Index.
Current property values
Based on a geometric mean of all four existing data sets, the index from Benham and Reeves shows the average UK house price sat at £305,680 in Q2 of this year.
This marked a 0.7% quarterly increase, the second consecutive quarter of positive growth, building on the four quarters of positivity seen in 2024. On an annual basis, the average UK house price also sat 2.3% higher when compared to Q2 2024.
In London, the average house price in Q2 2025 sat at £593,620. This marked a 0.9% increase on the previous quarter and , as with the wider UK picture, was the second consecutive quarter of positive growth this year. On an annual basis, London house prices also rose by 1.1%.
Market Gap Between Mortgage Approval Price (Buyers) & Asking Price (Sellers)
In Q2 2025, the market gap between the average mortgage approved price of a buyer (£284,307) and the asking price expectation of a seller (£378,312) sat at 33.1%.
This is the highest gap between seller expectation and buyer purchasing power seen since Q2 of last year when it sat at 35.5%, suggesting that whilst buyers are returning to the market, they remain restricted by higher mortgage rates.
In London, the gap between mortgage approved house prices (£532,449) and seller asking prices (£698,863) was 31.3%. As with the wider national picture, this is the largest gap seen since Q2 of last year.
Market Gap Between Asking Price (Sellers) & Sold Price (Buyers)
The latest index by Benham and Reeves shows that the difference between the average UK asking price and the average sold price has also increased.
Across the UK, the average sold price in Q2, 2025 stood at £265,560, -29.9% below the average asking price of £378,312. This is the largest gap seen since Q3 2024, again reinforcing that whilst buyer activity has been robust, sellers remain over-optimistic when it comes to pricing to sell in the current market.
In London, the difference between asking price and sold price sits at -19.6, having increased over the last four quarters.
Director of Benham and Reeves, Marc von Grundherr, commented:
“The housing market has demonstrated a great degree of resilience in 2025 and despite the turbulence of the wider economic landscape, we’ve seen house prices climb at a slow but consistent rate.
Buyers have returned at mass, with mortgage approvals posting above the 60,000 monthly threshold for well over a year now. However, they remain restricted by higher interest rates which are impacting their mortgage affordability and the price they are willing to commit to when purchasing.
In contrast, sellers are sitting stubbornly firm when it comes to their asking price expectations, which is evident from the widening gap between mortgage approved house prices and asking prices.
However, those who are securing a sale are the ones taking a pragmatic approach to current market conditions and adjusting their expectations accordingly. We’ve seen the level at which they’ve had to do so increase over the last year, but it does demonstrate that buyer appetites are healthy, as long as the property you are selling is within financial reach.”
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