EAST MIDLANDS MARKET UPDATE
EAST MIDLANDS
£525,000 £684,409 -3%
£334 £2bn 218
MEASURED MARKET
As ever there are competing forces at play on the state of the residential market. On the plus side, with the Bank Rate recently cut and mortgage rates falling, affordability pressures are easing. This has been further boosted by several lenders relaxing their lending criteria and the expectation of further interest rate cuts. This is balanced against the subdued economic backdrop and ongoing geopolitical risks, meaning that a measured pace of price growth is anticipated for the rest of the year.
ECONOMIC OUTLOOK
The Bank of England reduced interest rates from 4.5% to 4.25% in May, the fourth cut in under a year. The move is welcome news for buyers and sellers alike, as expectations of further cuts mount – although the Bank of England is quick to point out that the future path of interest rates is not preset – consensus forecasts suggest 3.75% by year end. For those with a good loan to value (60%), sub-4% mortgage deals have become more widely available. Lower bank rates are expected to gradually filter through to mortgage pricing, though fixed-rate products have already begun to reflect anticipated reductions. The downward trend in mortgage rates is driven by improved pricing in swap markets (albeit with some volatility) and strong competition amongst lenders. The average two-year fixed mortgage rate has now fallen to its lowest level since September 2022¹.
Recent reforms to mortgage regulation allowing buyers to borrow more, alongside lower interest rates supporting affordability will help stimulate housing market activity. This will be moderated though by concerns over the economy particularly prompted by global trade concerns. Reflecting these concerns, consumer confidence levels moderated slightly in April 2025 (reported level -23), levels over the last year have reflected the ongoing economic uncertainty but remain an improvement on confidence levels through the worst of the cost of living crisis in 2022 (levels reached -49 at their worst)².
MODERATE PRICING
The average asking price for homes coming to market rose by 1.4% in April to £377,182, just ahead of the typical April uplift of 1.2%³. This rise comes despite available stock levels
remaining at a 10-year high for the time of year. While seasonal price increases might signal seller confidence, those bringing properties to the market need to remain realistic given high stock levels. High competition among listings means pricing correctly from the outset is essential to attract buyers. Although stamp duty changes drove a spike in transactions, they didn’t trigger any notable price inflation. Price growth in March was flat at 0% and slipped a little in April (-0.6%) 4 . In the East Midlands, the prime market of Derby is currently the best performing.
Looking ahead, house price growth is forecast to be 1.6% by the end of 2025, with a modest 2.0% annual growth expected in 20265
A TEMPORARY COOLING OFF
Residential sales surged by 104% year-on-year in the run-up to the end of the Stamp Duty exemption as buyers rushed to complete before thresholds returned to pre-pandemic levels6 . Since then, with activity brought forward to meet the deadline, the housing market has perhaps unsurprisingly cooled a little. Mortgage approvals have fallen back marginally alongside a similar trend in new buyer enquiries, which softened in April for a third consecutive month. The next month or two might be a period of adjustment following the high transaction rates in March. Looking further ahead though, data collated by the RICS shows that agents still expect sales to rise over the year ahead (+17% of respondents, up from +11% in March7 ). Given the time of year and typical seasonal patterns, demand is largely being sustained and the average time to sell is coming down. In the East Midlands, the average time to find a buyer is 71 days, down from 79 at the start of the year³. 1Moneyfacts, ²GfK, ³Rightmove, 4 Nationwide, 5 HM Treasury, Average of Independent Forecasts, April 2025, 6 HMRC,
£527 ,00 0
£714 ,17 7
-0 .3 %
£37 3
£580 ,00 0
£761 ,98 8
-1 .6 %
£38 4
£483 ,00 0
£624 ,60 6
-0 .3 %
£33 2
£742 ,00 0
£985 ,69 8
-5 .8 %
£48 4
£925 ,00 0
£1 ,293 ,67 0
-8 1 %
£57 0
£415 ,00 0
£545 ,64 2
-2 4 %
£29 3
£502 ,00 0
£670 ,36 2
-3 .4 %
£34 9
£525 ,00 0
£684 ,40 9 -3 %
£33 4
£802 ,00 0
£1 ,084 ,94 5
-2 .7 %
£52 9
£1 ,520 ,00 0
£2 ,405 ,37 8
-17 .6 %
£1 ,20 7
EAST MIDLANDS PREMIUM MARKET
£465,000
£631,746 -3%
£352
£541,000
£709,955 -4.7%
£354
£502,000
£669,985 +0.4%
£333
£580,000
£787,951 -3.8%
£360
£541,000
£713,178 -5.5%
£339
£402,000
£518,117 -2.9%
£286
£461,000
£576,105 -3.9%
£284
£551,000
£689,981 -4.5%
£322
£611,000
£760,799 -3.2%
£341
EAST MIDLANDS PREMIUM MARKET
EAST MIDLANDS
EAST MIDLANDS MAINSTREAM MARKET
EAST MIDLANDS
£236,116
£525,000
£684,409
EAST MIDLANDS
£219,758
£372,000
£458,625
£131,479
£260,000
£330,596
£176,962
£318,000 £385,799
£346,043
£692,000
£889,644
£245,032 £536,000
£700,096
