UK house price growth accelerated as buyers rushed to beat stamp duty deadline
This took the average UK house price in March to £271,000, the Office for National Statistics (ONS) said.
The ending of a stamp duty holiday from April onwards sparked a stampede of home-buyers in the run-up. Stamp duty applies in England and Northern Ireland.
£271,000
Average UK house price in March Office for National Statistics
The figures were released as statistics showed UK inflation surged to its highest level for more than a year last month.
Households have been clobbered by a raft of 'awful April' bill increases.
Consumer Prices Index (CPI) inflation reached 3.5% in April, up from 2.6% in March and the highest level since January 2024. This was higher than some economists had been predicting, with a rise of 3.3% having been expected.
Andrew Montlake, chief executive at Coreco mortgage brokers, said: 'With inflation edging up sharply this morning, and mortgage rates likely to follow as expectations of further base rate cuts reduce, this could see average values start to retreat again. If prices do start to ease, they will only go so far as there is a fundamental lack of supply.'
Consumer Price Index (CPI) rose by 3.5% in the 12 months to April 2025, up from 2.6% in March 2025.
Read the full article ➡️ https://t.co/eeQd9l83c7 pic.twitter.com/yzyEv4hdEL
— Office for National Statistics (ONS) (@ONS) May 21, 2025
Jonathan Handford, managing director at estate agent group Fine & Country, said: 'In the months ahead, inflation and still-elevated borrowing costs are likely to weigh on demand, particularly as affordability remains stretched across much of the country.
'That said, a period of softer or stabilising house prices may offer a welcome opportunity for first-time buyers who have been priced out in some areas of the country.'
Sarah Coles, head of personal finance at Hargreaves Lansdown, said the 'rush to seal a deal' before the end of the stamp duty holiday provided some extra impetus for the housing market.
She added: 'This may well slow again in the next set of figures, which is the usual pattern in the aftermath of a stamp duty holiday. However, we're unlikely to see anything too dramatic.
'This period has been marked by robust price growth rather than stellar leaps, so the hangover from the property party is likely to be less painful.
'Lower mortgage rates should also help support prices. However, with buyer numbers likely to have dropped off fairly sharply, there's going to be some room for negotiation.'
The recent cut in mortgage rates has restored some confidence but April's sharp rise in inflation will not help Estate agent Jeremy Leaf
Nick Leeming, chairman of estate agent Jackson-Stops, said: 'Encouragingly, across the Jackson-Stops network we are seeing robust activity levels, with demand outpacing supply in popular markets. In April alone, an average of five potential buyers were competing for every new listing, underscoring borrowers' continued commitment.'
Jeremy Leaf, a north London estate agent, said some potential buyers and sellers are 'sitting on their hands', adding: 'The recent cut in mortgage rates has restored some confidence but April's sharp rise in inflation will not help.'
Average house prices increased to £296,000 (6.7% annual growth) in England, £208,000 (3.6%) in Wales, and £186,000 (4.6%) in Scotland, in the 12 months to March, according to the ONS.
The average house price in Northern Ireland was £185,000 in the first quarter of 2025 – a 9.5% annual increase.
Iain McKenzie, chief executive of the Guild of Property Professionals, said: 'We cannot ignore the subdued economic backdrop and ongoing geopolitical uncertainties which will likely ensure a more measured pace of growth for the remainder of the year.'
Richard Harrison, head of mortgages at Atom bank, said: 'Lenders have been incredibly active in reducing rates.'
We continue to witness, on average, around 10 applicants for every property available to rent Nathan Emerson, Propertymark
The ONS also said average UK monthly private rents increased by 7.4%, to £1,335, in the year to April. The annual growth rate eased from 7.7% in March.
Average rents increased to £1,390 per month (7.5% annual growth) in England, £795 (8.7%) in Wales, and £999 (5.1%) in Scotland, in April.
In Northern Ireland, average rents increased to £843 (7.8% annual growth) in the 12 months to February, the report said.
Within England, annual inflation in private rents was highest in the North East region (9.4%) and lowest in Yorkshire and the Humber (4.0%), in April.
Nathan Emerson, chief executive of property professionals' body Propertymark, said: 'Overwhelming demand within the rental sector continues to influence price increases for those who rent. We continue to witness, on average, around 10 applicants for every property available to rent and this is a situation that has broadly remained stagnated across the last five years.
'It is imperative that rental supply rises to meet the challenges of demand.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Metro
6 hours ago
- Metro
Interest rates predicted to stay at 4.25%
The UK interest rates are set to remain the same amid worldwide uncertainty and rising inflation. The interest rate is set to stay at 4.25% following a jump in inflation in April. Interest rates determine how much money people have to pay on loans or mortgages from a bank or a credit card. This means home buyers eyeing up a property cannot expect the cost of borrowing to be slashed when the Bank of England decides on the interest rate figure on Thursday. The decision will be made by the Bank of England's monetary policy committee (MPC) next week. It has voted to cut the rates at every meeting previously since it started easing borrowing costs last August. The current rate has reduced from the earlier 5.25% at the height of the cost of living crisis. British consumers faced the highest prices in 2023 during the height of the cost-of-living crisis, which is still gripping the country. There was light at the end of the tunnel until inflation surged to its highest level for more than a year in April, the latest figures from the Office for National Statistics show. To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Consumer Prices Index (CPI) inflation hit 3.5% in April, up from 2.6% in March. The ONS said the April figure should have been 3.4 due to an error in vehicle tax collection. Ellie Henderson, an economist for Investec, said monetary policy 'seems to be in a good position, allowing the Bank of England to wait and see how economic conditions and the international political backdrop evolve.' 'Ultimately, this is a highly uncertain time that requires a potentially nimble response from central banks, limiting any great foresight,' she said. 'Although the June decision might seem clear cut, how the MPC responds to the evolving economic backdrop thereafter much depends on the details of the world in which we find ourselves.' Markets are bracing for potential turmoil after the escalating tension between Israel and Iran, which saw missiles being fired at sites in both countries. More Trending The tension could have an impact on oil prices. Meanwhile, the UK job market is seeing wage growth ease heading into April, while the unemployment rate grew as employers faced higher costs. Rob Wood and Elliott Jordan-Doak, economists for Pantheon Macroeconomics, said the weaker job market could be a factor in reassuing the Bank of England's committee that 'it can plan on further rate cuts.' View More » But they said one month's fresh data 'is far from enough to allow the MPC to bin its gradual and careful approach to easing monetary policy.' Get in touch with our news team by emailing us at webnews@ For more stories like this, check our news page. MORE: 5 forgotten items in your attic that could be worth over £11,000 MORE: Credit card customers can save up to £1,679 with a simple debt 'spring clean' MORE: I've got 'number dyslexia' – but I'm a financial expert Your free newsletter guide to the best London has on offer, from drinks deals to restaurant reviews.
North Wales Chronicle
16 hours ago
- North Wales Chronicle
UK interest rates predicted to stay at 4.25% with Bank ‘nimble' amid uncertainty
Most economists think the Bank of England's Monetary Policy Committee (MPC) will opt to keep rates on hold when it meets on Thursday. The MPC has voted to cut rates at every other meeting since it started easing borrowing costs last August, from a peak of 5.25%. This has been possible while the rate of UK inflation has been steadily falling from the highs reached in 2023, at the peak of the cost-of-living crisis. However, inflation jumped to its highest level for more than a year in April, according to the latest figures from the Office for National Statistics (ONS). Consumer Prices Index (CPI) inflation hit 3.5% in April, up from 2.6% in March. Since releasing the data, the ONS said that an error in vehicle tax data collected meant the April figure should have been 3.4%. Ellie Henderson, an economist for Investec, said monetary policy 'seems to be in a good position, allowing the Bank of England to wait and see how economic conditions and the international political backdrop evolve'. 'Ultimately, this is a highly uncertain time that requires a potentially nimble response from central banks, limiting any great foresight,' she said. 'Although the June decision might seem clear cut, how the MPC responds to the evolving economic backdrop thereafter much depends on the details of the world in which we find ourselves.' On Friday, oil prices were soaring after Israel launched an attack on Iran's nuclear programme, raising anxieties about possible disruption to the supply of the commodity in the Middle East. And ongoing uncertainty over US President Donald Trump's tariffs, which surveys suggest have dampened business confidence and reduced exports, also remains in focus for policymakers. Meanwhile, new official figures showed wage growth for UK workers eased sharply in the three months to April and the unemployment rate increased, as employers feel the effects of higher costs. Rob Wood and Elliott Jordan-Doak, economists for Pantheon Macroeconomics, said a weaker jobs market 'will reassure the MPC that it can plan on further rate cuts', but added that 'one month's data is far from enough to allow the MPC to bin its 'gradual and careful' approach to easing monetary policy.' Bank chief economist Huw Pill, who is also an MPC member, said last month that he thought rates had been cut too quickly partly due to the risk of 'stubbornly strong' pay growth on overall inflation. New UK inflation figures for May will be released on Wednesday, while the US central bank is also widely expected to keep its interest rates on hold.
Powys County Times
16 hours ago
- Powys County Times
UK interest rates predicted to stay at 4.25% with Bank ‘nimble' amid uncertainty
UK interest rates are set to stay at 4.25% after inflation jumped in April and policymakers remain 'nimble' to the evolving economic backdrop, economists have predicted. Most economists think the Bank of England's Monetary Policy Committee (MPC) will opt to keep rates on hold when it meets on Thursday. The MPC has voted to cut rates at every other meeting since it started easing borrowing costs last August, from a peak of 5.25%. This has been possible while the rate of UK inflation has been steadily falling from the highs reached in 2023, at the peak of the cost-of-living crisis. However, inflation jumped to its highest level for more than a year in April, according to the latest figures from the Office for National Statistics (ONS). Consumer Prices Index (CPI) inflation hit 3.5% in April, up from 2.6% in March. Since releasing the data, the ONS said that an error in vehicle tax data collected meant the April figure should have been 3.4%. Ellie Henderson, an economist for Investec, said monetary policy 'seems to be in a good position, allowing the Bank of England to wait and see how economic conditions and the international political backdrop evolve'. 'Ultimately, this is a highly uncertain time that requires a potentially nimble response from central banks, limiting any great foresight,' she said. 'Although the June decision might seem clear cut, how the MPC responds to the evolving economic backdrop thereafter much depends on the details of the world in which we find ourselves.' On Friday, oil prices were soaring after Israel launched an attack on Iran's nuclear programme, raising anxieties about possible disruption to the supply of the commodity in the Middle East. And ongoing uncertainty over US President Donald Trump's tariffs, which surveys suggest have dampened business confidence and reduced exports, also remains in focus for policymakers. Meanwhile, new official figures showed wage growth for UK workers eased sharply in the three months to April and the unemployment rate increased, as employers feel the effects of higher costs. Rob Wood and Elliott Jordan-Doak, economists for Pantheon Macroeconomics, said a weaker jobs market 'will reassure the MPC that it can plan on further rate cuts', but added that 'one month's data is far from enough to allow the MPC to bin its 'gradual and careful' approach to easing monetary policy.' Bank chief economist Huw Pill, who is also an MPC member, said last month that he thought rates had been cut too quickly partly due to the risk of 'stubbornly strong' pay growth on overall inflation.
