UK house price growth accelerated as buyers rushed to beat stamp duty deadline

South Wales Guardian

21-05-2025

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.
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.
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— 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.'
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.'
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.'