Residential Property Review – September 2025
| Any Autumn Budget changes to Stamp Duty and CGT could heavily influence housing activity in late 2025 | Mortgage rates dipped below 5% but gilt yields raise concern of further increases | 15% of property sales fell through in 2025, with converted homes most affected |
Housing market outlook
According to Savills, housing market performance for the rest of the year is dependent on the Autumn Budget, with many speculating that the Chancellor will announce changes to Stamp Duty and Capital Gains Tax.
This uncertainty may slow down market activity up to 26 November, as buyers and sellers wait to see what Rachel Reeves has in store. Sensible pricing will therefore be essential for those looking to secure a sale over the coming months.
Moneyfacts reported in mid-August that the average five-year fixed rate mortgage fell below 5% for the first time since May 2023. However, the yield on 30-year UK government bonds hit a 27-year high in September, bringing concerns that mortgage rates will go up again.
Meanwhile, rental growth was 2.4% in August according to Zoopla, the lowest annual rate in four years and less than half that recorded in August 2024.
15% of property sales fall through
It’s not been the easiest year for sellers, with one in seven property sales falling through between January and July 2025.
According to property data analysts Outra, it took an average of 35 days for a sale to fall through after going under offer. The South East was the UK region with the highest number of fall-throughs (17.07%), followed by the South West (16.83%). Scotland had the fewest (8.14%), but this is reflective of lower market activity in the area.
The property type with the highest fall-through rate was converted homes (17.35%), followed by end-of-terrace houses (16.03%).
Simon Dawson at Outra commented, “There’s a limit to what you can do to prevent your sale falling through – when you’re dealing with a buyer, some things are out of your control. By understanding market trends and buyer behaviour, you can make better-informed decisions, reduce risk and increase certainty in the selling process.”
Buyer hotspots in London
Rightmove has identified the most in-demand areas amongst homebuyers in London.
A map highlighting the most desirable areas in the capital has caused a stir online – shaped like a banana, the curve runs from South West to North East London. However, Rightmove’s research has shown that eight out of the ten buyer hotspots are not actually inside this area. Docklands and Hackney are the most in demand, both outside of the banana zone. Islington and Battersea were the only neighbourhoods that fell within the curve.
Property expert at Rightmove, Colleen Babcock commented, “Affordability is a key driver, with many of the most in-demand locations offering better value than the London average. It’s a reminder that buyer interest doesn’t always follow the trend, it follows the opportunity.”
All details are correct at the time of writing (17 September 2025)
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