UK house prices recorded steady growth in February, maintaining the same annual pace as the previous month. The figures suggest a modest recovery following a dip at the end of 2025, with market activity projected to strengthen in the months ahead.
The average property price reached £273,176 in February, reflecting a 0.3% monthly increase, unchanged from January. Annual growth remained at 1.0%, according to Nationwide’s latest house price index, indicating stability rather than acceleration in the housing market.
Britain’s largest building society said the data reinforces signs of gradual improvement after uncertainty surrounding potential property tax changes weighed on sentiment late last year. While conditions remain subdued in parts of the market, transaction levels and buyer activity have shown measurable gains over the past twelve months.
Transactions and Buyer Activity Show Measurable Gains
According to Nationwide’s chief economist Robert Gardner, annual house price growth “remained steady at 1.0% in February,” with prices rising by 0.3% month on month after seasonal adjustment. He noted that this supports the view of a modest recovery following the end-of-year slowdown, which had been linked to uncertainty ahead of the Budget.
Looking at the broader picture, total housing market transactions in 2025 were 10% higher than in 2024, according to Nationwide’s data. Mortgage completions rose by 18% year on year, reflecting increased participation from first-time buyers. Improved affordability and easing credit availability have contributed to this trend, the lender reported.
Home mover activity also strengthened, with mortgaged transactions increasing by 15% compared with the previous year. Mortgage approvals for house purchases remain close to levels seen before the pandemic, Gardner said, suggesting that underlying demand has stabilised.
In the buy-to-let segment, activity has increased gradually, though it remains subdued compared with historical norms. Nationwide pointed to higher borrowing costs and regulatory changes as ongoing headwinds affecting landlord sentiment. Cash purchases accounted for 35% of transactions in 2025, down from a peak of 42% in 2023, indicating a shift in the composition of buyers.
Interest Rates, Affordability and Market Sentiment
The outlook for the housing market remains closely tied to interest rate expectations and broader economic conditions. Gardner stated that housing market activity is likely to recover in the coming quarters if the improving affordability trend seen last year is maintained.
External analysts have highlighted similar dynamics. According to Alice Haine, personal finance analyst at Bestinvest by Evelyn Partners, steady price growth reflects improving confidence and rising supply, with more homes coming onto the market compared with a year ago. She said that competitive mortgage rates and a wider choice of low-deposit products for first-time buyers have supported sentiment.
At the same time, some commentators caution against expectations of rapid price growth. Ian Futcher, financial planner at Quilter, said the market remains subdued despite the recent monthly increases, adding that a marked uplift in house prices appears unlikely in the near term.
Geopolitical uncertainty and energy price volatility could also influence inflation and the trajectory of interest rates, analysts noted. For now, the February figures point to stability rather than surge, with steady growth providing a platform for what lenders describe as a gradual and sustainable recovery.
