UK housing prices rose in March, but the outlook remains challenging

Investing.com – Based on data released on Tuesday, UK March house prices rose 0.9%, to £817, bringing the Nationwide average house price to £277,186.

Compared with March 2025, house prices were up 2.2% year over year, or £5,870; the increase was higher than the 1% annual growth rate recorded last month. After seasonal adjustment, house prices rose 0.9% month over month, higher than February’s 0.4%.

Nationwide said developments in the Middle East situation have dealt a major blow to the global economy, casting a shadow over the housing market outlook. The scale of the impact on the UK real estate market will depend on how long this shock lasts.

The data shows a disconnect between new-build and existing home prices. UK housebuilders report that, so far this year, house prices have remained stubbornly flat, and some builders are offering steep discounts to boost sales rates.

By contrast, Rightmove data showed that March asking prices rose 0.8% month over month, or £3,023, but fell 0.2% year over year.

The Iran war and its expected impact on mortgage rates and the cost of living are likely to cool down home-buying activity, taking the edge off the spring peak selling season. Housebuilders may face downward revisions to profit-margin assumptions, as they need to cut prices to maintain or raise sales rates.

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