UK (Parliament Politics Magazine) – Halifax reveals that UK house prices fell by 0.5% in March, the largest fall in a year, as demand normalized after a rush to beat stamp duty changes.
As reported by The Guardian, the UK housing market has seen its biggest decline in a year, with prices experiencing their largest annual drop after buyers rushed to secure deals before the stamp duty changes in England and Northern Ireland.
What did Halifax say about the recent decline in UK house prices?
A prominent financial services company in the UK, Halifax, reported a 0.5% decline in the average property cost last month. This brought the average price down to £296,699, the sharpest fall since March of the previous year.
For the second consecutive month, house prices have dropped, with Halifax adjusting February’s decline from 0.1% to 0.2%.
After a record high in January, house prices have fallen for two months as buyers rushed to complete purchases before the stamp duty increase.
According to Halifax statistics, part of Lloyds Banking Group, the market’s momentum is decreasing.
March saw annual growth hold steady at 2.8%, a decrease from 3.4% in December and 4.7% in November.
What did Amanda Bryden say about house price trends after the stamp duty deadline?
The head of mortgages at Halifax, Amanda Bryden, stated,
“House prices rose in January as buyers rushed to beat the March stamp duty deadline,”
adding,
“However, with those deals now completing, demand is returning to normal and new applications slowing.”
He added,
“Our customers completed more house sales in March than in January and February combined, including the busiest single day on record. Following this burst of activity, house prices, which remain near record highs, unsurprisingly fell back last month.”
First-time buyers’ tax after stamp duty changes
First-time buyers in England and Northern Ireland will have to pay stamp duty on properties valued over £300,000, down from £425,000 from April 1.
Stamp duty for all housing in England and Northern Ireland has dropped from £250,000 to £125,000.
Rachel Reeves revealed in her October budget that temporary stamp duty cuts in England and Northern Ireland would end in April. Scotland and Wales impose different taxes on house purchases.
What did Nathan Emerson say about the housing market’s dip?
Nathan Emerson, the chief executive of Propertymark, stated,
“Hopefully this month on month dip is only temporary,”
adding,
“The spring and summer months normally spur on a flurry in housing activity, especially at a time when there are many competitive mortgage deals out there right now as a result of the reduction in interest rates last year.”
Economists’ views on the housing market outlook
Despite concerns over the UK’s struggling economy, as noted by the Bank of England, economists and analysts predict house prices will continue to increase in 2025. The growth is attributed to limited supply and stable demand.
Falling mortgage rates are expected to rise, with markets anticipating three additional 0.25 percentage point reductions in the base interest rate.
What did Andrew Carter say about Labour’s housing target?
Labour plans to construct 1.5 million new homes within the next five years.
The CEO of the Centre for Cities, Andrew Carter, stated,
“We’re in a productivity crisis. The UK’s big cities are the jobs and productivity engines of the economy, but our planning system doesn’t allow – and has never allowed – them to build an adequate supply of homes for everyone who could work there.”
Mr Carter added,
“By removing the discretionary element of the planning system, the UK would bring its planning system in line with most developed economies, remove a big block on housebuilding and enable places to better respond to future rises in demand for homes.”