House prices across the UK rose 0.2% in June to £299,330, according to the latest Lloyds house price index. It’s a modest gain, but a symbolically significant one: the first monthly increase since February, and the clearest sign yet that the property market is steadying after four months of turbulence triggered by the Iran conflict.
Annual growth edged up to 0.6%, from 0.5% the previous month. The typical home remains fractionally below its January peak of £300,283, but the direction of travel has shifted.
“It’s hardly the stuff of headlines, but the direction of travel matters more than the pace right now,” said Anthony Codling, property analyst at RBC Capital Markets. “After a choppy few months shaped by global uncertainty, tariff-driven inflation anxiety and the resulting rate volatility, June’s data offers a tentative but welcome signal that the market is finding its footing.”
That 0.6% national average conceals a market moving at dramatically different speeds. Strip out the regional breakdown and the picture becomes stark.
Northern Ireland continues to outperform every other part of the UK, with prices up 7.4% over the past year to £229,000. Scotland recorded the second-strongest growth at 3.9%, with average values reaching £223,277. In England’s north-east, prices climbed 2.8% to £181,133, while the north-west saw growth of 2.4%, pushing average values to £248,218.
The south tells a different story entirely.
The south-east led the declines, with prices falling 2% year on year to £381,654. London dropped 1.1% to £534,831. The south-west and east of England also recorded negative annual growth.
The pattern isn’t random. More affordable markets, where improved mortgage rates have the greatest impact on borrowing power, are the ones gaining ground. Zoopla data supports this reading: across the north of England, Scotland and Wales, prices are rising between 2% and 3.6%. Buyers in Scotland are searching for homes priced 8% above last year’s levels, a sign of genuine appetite rather than reluctant acceptance.
Jonathan Hopper, chief executive of buying agents Garrington Property Finders, put it bluntly. “Property prices are again heading in opposite directions at opposite ends of the country,” he said. “In southern areas a glut of supply is attracting too few serious buyers, and this is steadily driving prices down. Buyers are often able to ask for, and get, reductions on the asking price.”
For Norfolk and Suffolk, this positions the region in an interesting middle ground. Neither as overheated as the deep south-east nor as aggressively affordable as the north-east, East Anglia’s market combines relative value with lifestyle appeal. The Ivybridge Collection’s 324 local property market reports show this variation playing out at a granular level across the region.
One encouraging thread in the data: first-time buyer demand isn’t collapsing. Annual price growth for first-time buyer properties accelerated to 0.8% in June, up from 0.3% in May, with the average starter home now costing £240,433.
Amanda Bryden, head of mortgages at Lloyds, described the segment as “resilient” and pointed to lower borrowing costs providing “some support for demand, though affordability constraints remain an important factor.”
Scotland’s first-time buyer market appears particularly active. Registers of Scotland data show residential sales volumes up 1.5% year on year, with terraced homes performing best, recording price growth of 4.7%. Flats and maisonettes, by contrast, managed just 1.5%.
Fresh data from Connells Group adds another layer to the picture. Just 52% of properties listed in January received an offer within six months, down from 58% at the same point last year. The share securing an offer in the first month slipped from 42% to 38%.
Two and three-bedroom homes remain what Connells calls the market’s “sweet spot,” with offer rates of 55% and 53% respectively. The real squeeze is at the top end: five-bedroom properties saw their offer rate plunge from 59% to just 41%.
“The housing market is still moving, but buyers have become more selective about where they spend their money,” said Aneisha Beveridge, research director at Connells Group. “The strongest demand continues to be concentrated in the middle market.”
Eight of Britain’s ten fastest-moving local markets are now in the Midlands and the north, with Bury topping the table.
Kate Faulkner, the property analyst, flagged a remarkable long-term finding in her latest national review. Since 2005, Scotland is the only UK nation where average property price growth has consistently outpaced inflation, which has averaged around 2.85% per year over that period.
The weaker performance elsewhere reflects the correction in many markets since 2022 and the ongoing drag of higher mortgage rates on affordability. With the Bank of England base rate sitting at 3.75%, Faulkner argues further reductions towards 3.0% to 3.25% are needed before borrowing capacity improves enough to support a stronger price recovery.
The immediate outlook hinges on two things: the path of mortgage rates and the political transition. Hopper suggested that buyer sentiment in the north “could accelerate further under a Burnham premiership” given expectations of government investment and job creation. In the south, sellers face a more sobering reality: price your property correctly or risk watching it sit unsold.
Mortgage rates have retreated from their April peak of 5.90% on a typical two-year fix to 5.49%, according to Moneyfacts. That’s still well above pre-war levels, but the trajectory is encouraging. If the Iran ceasefire holds and oil prices remain stable around $72 a barrel, there’s room for further easing.
For buyers and sellers across Norwich, Ipswich, and the wider East Anglian market, the message is measured but not downbeat. The market hasn’t stalled. It’s recalibrating, and the regions offering genuine value are the ones finding their feet first.
