House prices fall £7,365 in one month as rising stamp duty costs bite
House prices fell between March and April this year, official figures have revealed.
The average property fell by more than £7,000 in one month from £272,862 in March to £265,497 in April, according to the latest figures from the Office for National Statistics.
In percentage terms, it means house prices fell by 2.7 per cent during the month.
On a yearly basis, house price growth dropped from 7 per cent in March to 3.5 per cent in April - the first slowdown since December 2023.
The sudden drop is being attributed to Stamp Duty Land Tax changes that came into effect at the start of April.
From 1 April, home movers found themselves having to pay up to £2,500 more in SDLT as the thresholds were returned to pre-2022 levels.
First-time buyers could face extra stamp duty as high as £11,250 depending on the price of the property they are buying.
Some areas of the country saw greater and smaller changes in prices, however.
For instance in the North East of England house prices fell from £169,751 to £156,010 between March and April - an 8 per cent decrease.
Meanwhile, in the West Midlands average prices only fell by 0.7 per cent from £232,797 to £231,159.
In London average house prices rose 2.6 per cent between March and April from £552,402 to £566,614.
House price growth down year-on-year
The annual rate of house price growth has slowed for the first time since December 2023, according to the ONS.
While the average property is up 3.5 per cent in the 12 months to April, this marks a huge slowdown from the 7 per cent annual rise in March.
The average house price for England was £286,000 in April. This is up 3 per cent from a year earlier but is a slowdown compared to 7.3 per cent seen in the 12 months to March.
The North East was the English region with the highest house price inflation in the 12 months to April, at 6.4 per cent. However, this was down from 15.3 per cent in the 12 months to March.
Annual house price inflation was lowest in the South West, at 0.9 per cent in the 12 months to April. This was down from 5.9 per cent in the 12 months to March.
The ONS house price index, which is based on sold prices, lags other house price indices.
More recent data suggests that house prices could be on the rise again.
The average home was selling for £273,427 in May, according to Nationwide Building Society's own mortgage data, up from £270,752 in April.
'The UK housing market is still in recovery mode after the stamp duty cliff edge in April, but prices are being kept firmly in check by an overhang of supply,' said Tom Bill, head of UK residential research at Knight Frank.
'We don't expect an interest rate cut before August but the weak state of the UK economy is putting downwards pressure on mortgage rates, which should support demand in the short-term.
'As activity gathers momentum, what buyers and sellers could do without this summer is a re-run of last year and a game of 'guess the tax rise' ahead of the Autumn Budget.'
Best mortgage rates and how to find them
Mortgage rates have risen substantially over recent years, meaning that those remortgaging or buying a home face higher costs.
That makes it even more important to search out the best possible rate for you and get good mortgage advice, whether you are a first-time buyer, home owner or buy-to-let landlord.
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This is Money and L&C's mortgage calculator can let you compare deals to see which ones suit your home's value and level of deposit.
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