The latest figures from the Office for National Statistics (ONS) paint a nuanced picture of the UK housing market as the country heads toward the end of 2025. After several years of rapid growth, both rent and house price inflation have shown signs of easing, offering some relief to tenants and prospective homebuyers while still reflecting persistent affordability challenges across much of the country.

According to provisional ONS estimates, the average UK monthly private rent increased by 4.4% in the twelve months to November 2025, bringing the average monthly cost to £1,366. Notably, this annual growth rate marks a decrease from the previous month’s figure of 5.0% and represents the lowest annual inflation rate since June 2022. This softening in rent inflation suggests some moderation in the pressures that have been squeezing renters nationwide, though the overall cost of renting remains high by historical standards.

Regional disparities remain a defining feature of the rental market. England’s average rents rose by 4.4% to £1,422, with Wales seeing a sharper increase of 6.1%, lifting the average to £820. Scotland experienced a 3.3% rise, reaching £1,012, while Northern Ireland saw the largest jump at 6.4% with average rents climbing to £871 in the twelve months to September 2025. Within England, the North East stood out with the highest annual inflation rate for private rents at 8.4%, while London registered the lowest at 2.8%. These variations point to localized supply and demand dynamics, as well as the differing economic conditions across the UK’s nations and regions.

The parallel story in house prices is one of continued, but slowing, growth. The average UK house price rose by 1.7% in the twelve months to October 2025, reaching £270,000. This represents a further slowdown from the 2.0% growth recorded over the previous year to September 2025, suggesting that the era of double-digit annual price rises seen earlier in the decade has firmly passed, at least in most areas. This softening may reflect a combination of rising interest rates, affordability constraints, and changing patterns of demand as households adjust to evolving economic circumstances.

Again, regional differences are striking. England’s average house price stood at £292,000, up 1.4% which is a modest £4,000 increase from the previous year. Wales’s house prices rose by 1.5% to £211,000, also a £4,000 year-on-year gain, while Scotland saw a more robust 3.3% rise, taking the average to £192,000, an increase of £6,000. Northern Ireland was the outlier, with house prices in Quarter 3 of 2025 up by a notable 7.1%, or £13,000, compared to the same period in 2024, reaching an average of £193,000. This significant rise in Northern Ireland stands in contrast to the more moderate increases seen elsewhere and may reflect distinct local market conditions and supply constraints.

Looking within England, the North East leads the way with the highest house price inflation at 5.0% in the twelve months to October 2025, up from 3.0% in the preceding period. This acceleration sets the North East apart from other regions, highlighting its relative affordability and possibly increased attractiveness to buyers seeking value outside traditional property hotspots. By contrast, London has experienced the weakest performance in house prices. The capital saw average prices fall by 2.4% over the year to October 2025, deepening from a 1.6% decline in the twelve months to September. This ongoing softness in London’s market could be attributed to a variety of factors, including higher starting prices, shifting work patterns, and tighter affordability constraints for buyers.

The deceleration in both rent and house price inflation across the UK signals an important shift in the property market landscape. For renters, slower increases may mean budgets are less stretched than in recent years, although nominal rent levels remain elevated. For would-be homeowners, the moderation in house price growth could offer a window of opportunity, especially in regions where affordability is less constrained and wage growth is beginning to outpace inflation. However, the regional diversity in both rents and prices underscores the complexity of the UK housing market, where local supply, demand, and economic factors can drive markedly different outcomes.

As 2025 draws to a close, the UK housing market appears to be moving toward a phase of greater stability, with less dramatic fluctuations in rents and prices than seen previously. Nevertheless, underlying challenges such as limited housing supply, regional economic disparities, and the impact of broader economic trends will continue to shape the market in the coming year. Policymakers, industry stakeholders, and households alike will be watching closely to see if this recent moderation in inflation marks the beginning of a new, more sustainable era for UK housing or simply a temporary pause before another period of change.