Q1 2025 Market Update – A Confident Start to the Year

The first quarter of 2025 has brought a renewed sense of optimism to the UK property market. Despite lingering affordability challenges and broader economic uncertainty, Q1 has seen a noticeable uplift in both supply and demand – driven by realistic pricing, committed sellers, and motivated buyers.

📈 New Listings Surge After the Festive Period

January kicked off the year with impressive momentum. Over 155,000 homes came to market that month alone – the strongest start to a year in more than a decade – following record-breaking levels of Boxing Day activity. Compared to the five-year average, new listings in Q1 were up by 8.92%.

February saw a minor dip (down 2% year-on-year), but this was short-lived. March bounced back strongly, finishing 3% above the five-year average. With the traditionally busy spring market approaching, listing volumes are forecast to rise a further 13% above average in Q2.

🔻 Price Reductions at a Five-Year High

One of the most defining features of Q1 has been the spike in price reductions. Price reductions rose by 49.7%, with nearly 88,000 price changes recorded in March alone – the highest number in the past five years.

This highlights how price sensitivity is shaping the current market. With buyers having more choice and taking their time, properties priced correctly from day one are attracting the most interest. In contrast, overpriced homes are seeing reduced activity, longer time on the market, and eventually require price reductions to generate offers.

⚠️ Fall-Throughs Increase After Stamp Duty Changes

One downside to Q1 was the 19.12% year-on-year increase in fall-throughs, with a sharp 56% rise between December and January.

• This was largely driven by changes to Stamp Duty introduced late last year:
• The surcharge for additional property purchases increased from 3% to 5%
• The first-time buyer threshold was reduced to £300,000

These adjustments affected affordability and lending assessments, particularly for buyers in chains. However, the Bank of England’s February base rate cut to 4.5%, along with easing affordability checks by major lenders, is expected to calm the situation and support more completions moving forward.

🏡 Fewer Withdrawals Indicate Motivated Sellers

In a promising sign, the number of property withdrawals fell 20.41% below the five-year average. This suggests sellers are more committed than ever, with many opting to adapt their pricing strategy rather than withdrawing altogether. The shift reflects a growing understanding that well-priced homes are the ones seeing genuine results.

🔮 Looking Ahead: What to Expect in Q2 and Beyond

The outlook for the rest of 2025 remains cautiously optimistic. Lenders such as Halifax are forecasting house price growth of 0–3% over the year. Market activity is still closely tied to interest rates, affordability, and buyer sentiment – but with mortgage products becoming more flexible and competitive, steady progress looks likely.

✅ In Summary

Q1 2025 has delivered a solid, confident start to the year.
✔️ Listings are up
✔️ Sellers are more realistic
✔️ Buyers are returning – but with a price-conscious mindset

For those thinking about making a move, spring 2025 could offer a golden window. With more homes coming to market and stronger commitment from both sides, now is a great time to get ahead of the curve.

Source: Spectre’s Market Report – Q1 2025 (product-related figures and static market sales as of 31/03/25)