"The slowdown is modest and less severe than the impact of the 2022 mini budget. It’s early-stage buyers adopting a cautious approach to new purchases ahead of the Budget, with greater caution for those buying higher-value homes."
- Richard Donnell - Zoopla
House price growth has slowed over 2025, standing at 1.3%, broadly in line with last year, while many buyers are adopting a ‘wait and see’ approach amid Budget uncertainty. This shift has driven the first annual fall in new sales agreed in two years, according to the latest report from Zoopla.
The usual pre-Christmas slowdown started six to eight weeks early this year. Buyer demand is down 8% and sales agreed are down 3% year-on-year, reflecting a more cautious approach as potential changes to stamp duty and capital gains tax linger. Homes priced above £500,000 are particularly affected, with higher-value properties in southern England seeing the largest declines.
Table 1: Budget uncertainty drives wait and see approach on sales and buyer demand
Despite the slowdown, two years of strong sales activity have built a substantial pipeline. Almost 350,000 homes, valued at over £100 billion, are currently working their way through the sales process, the largest backlog in more than four years.
Regional performance and house prices
The number of homes for sale is 7% higher than a year ago. Regional performance varies:
Scotland (+3%), Yorkshire & the Humber (+4%), the South West (+1%) and the West Midlands (+1%) are still seeing modest sales growth.
Southern England and Wales are experiencing sharper falls, with new sales down in Wales (-9%), the South East (-8%), the East of England (-6%) and London (-5%).
House price growth has slowed nationally to 1.3%, leaving the average UK home valued at £270,000, a £3,600 increase over the last year. The slowdown is particularly pronounced across southern England, where weaker demand and affordability pressures have stalled price growth. By contrast, house prices remain above 2% growth in Scotland, Wales and the northern regions of England, broadly maintaining the levels seen last year.
Table 2: House price growth stalls in the south and continues across rest of the country
Higher-value homes feel Budget uncertainty
Homes priced above £500,000 are seeing the largest declines in sales, listings and buyer interest. Speculation over potential reforms, including replacing stamp duty with an annual property tax, adjustments to council tax, and introducing capital gains tax on properties over £1.5 million, has prompted early-stage buyers to pause their searches until after the November Budget.
This cautious approach is slowing transactions and directly affecting price growth in southern regions, while northern markets remain more resilient.
Record pipeline of sales
Two years of elevated activity have created a historic sales pipeline, with nearly 350,000 homes valued at over £100 billion currently working their way to completion. The average purchase takes five to six months to complete, supported by strong first-time buyer demand and stability in mortgage rates.
Table 3: Largest sales pipeline for four years
However, the speed of finding a new buyer has slowed. The average time to sell is now 37 days, roughly 10% longer than last year. Southern England is taking the longest, with London at 45 days, 20% longer than last year. Northern England and Scotland continue to see the fastest sales, reflecting ongoing strong demand. Sellers who need to reduce prices typically face even longer wait times.
“The housing market is experiencing a slowdown in activity, but there are still serious sellers looking to buy homes and secure their next home purchase," explained Richard Donnell, executive director at Zoopla.
He added, "Buying a home is a lengthy process, and there is a record number of homes for sale, which means lots of buyers are looking for their next home. The slowdown is modest and less severe than the impact of the 2022 mini budget. It’s early-stage buyers adopting a cautious approach to new purchases ahead of the Budget, with greater caution for those buying higher-value homes. The housing market remains on track for the most housing sales since 2022, and house prices are set to end the year 1-1.5% higher than the start of 2025.”
Foxtons CEO, Guy Gittins, noted, “While the market has clearly slowed in recent weeks, much of this reflects a natural pause as buyers and sellers understandably take stock ahead of the November Budget. Once there is greater clarity around taxation and economic policy, we expect confidence to return quickly – particularly in London, where underlying demand remains strong and well-funded buyers are still active."
"The current slowdown should therefore be viewed as a temporary pause rather than a fundamental shift in market dynamics,” he added.
Nathan Emerson, CEO of Propertymark, comments, “While a slowdown in new sales is to be expected ahead of the Budget, many of our member agents continue to report strong levels of motivated buyers and sellers who are simply pausing for clarity rather than exiting the market altogether.
“Speculation around potential changes to Stamp Duty and Capital Gains Tax inevitably creates uncertainty, particularly at the higher end of the market, but the fundamentals remain stable. Employment levels are strong, mortgage rates have eased slightly, and the overall pipeline of sales remains robust.
“Hopefully, the Chancellor recognises the importance of confidence and stability in the housing sector. Any reforms must provide long-term certainty and support for both buyers and sellers, not short-term measures that risk further hesitation. The UK Government has an opportunity next month to reinforce trust and momentum in the market as we head into 2026.”
Matthew Thompson, head of sales at Chestertons, says, “Many buyers have paused their property search ahead of the November Budget. Uncertainty over potential tax changes is holding back activity but if the announcements bring clarity, confidence could return quickly and create an unusually busy end to the year.”
