Latest house price index shows resilient market

More homes are selling than this time last year even though fewer people are actively looking, according to Zoopla’s house price index for May.

The property website also revealed that there are fewer first-time buyers in the market, but they are targeting homes around £10,000 more expensive than last year.

The average house price in the UK is now £271,900 – a rise of 1.5% over the past year.

Semi-detached houses experienced the highest annual price growth, at 2.5%; however, the value of flats and maisonettes fell by -1.3% over the same period.

The housing market is holding up in the face of uncertainty and higher borrowing costs, though with fewer buyers than a year ago the outlook remains finely balanced.

The longer-term economic consequences of events in the Middle East on UK inflation, cost of living and mortgage rates are not clear and uncertainty remains looking into 2027. Average mortgage rates jumped from 4% at the start of the year to 5% in April. They have been drifting lower but look set to remain higher than the start of the year.

Zoopla

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Council tax charges add to SME challenges

A new report from the Home Builders Federation (HBF) and Paragon Development Finance has found that almost half (45%0 of local authorities are charging developers full council tax rates on new-build homes which are unoccupied or awaiting sale.

The report – Licence to Bill – revealed that these charges add to already challenging viability issues for new developments.

Almost nine in ten (88%) SME developers reported that council tax charges are affecting their cash flow and threatening their ability to deliver future sites.

In some instances, council tax is being charged on homes which are uninhabitable, lacking utilities, fixtures or fittings.

Neil Jefferson, Chief Executive of the Home Builders Federation, said: “Charging council tax on incomplete new build homes before they are sold, occupied or, in some cases, fully ready to live in places further pressure on cash flow and can make the difference between a site being viable or not.

“These properties are not long-term empty homes, second homes or homes deliberately withheld from occupation. They are new homes being brought to market in challenging circumstances, often by the smaller businesses Government has repeatedly said it wants to support.

“We are urging Government to introduce a clearer, fairer and more consistent national approach and to remove this damaging additional tax on development that is acting as yet another barrier to SME builders staying in sector.”

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Developer and supply chain updates

Keepmoat increased its secured pipeline by 18% to more than 28,800 plots in the year to October 2025, providing around nine years of development at current build rates. Despite challenging market conditions, including high mortgage rates and planning delays, the partnership housebuilder said it had strengthened its position for future growth through successful land acquisitions and the rebuilding of its outlet pipeline.

Turnover fell 4% to £733m and pre-tax profit declined 17% to £45m, while homes sold dropped 11% to 3,124. However, average selling prices rose 8% to £235,000 and gross margin improved to 18.6%, supported by a greater focus on partnership delivery and bulk sales to housing associations and build-to-rent investors.