End of stamp duty buying-frenzy leads to small dip in house prices

House prices dipped by 0.8 per cent in April, the first month of the stamp duty surcharge and the period when market activity cooled after a buying frenzy before the duty deadline.

The data, from the Halifax, takes the average price of a home in the UK to £212,321.

Prices in the three months - February, March and April - were 9.2 per cent higher than in the same period of 2015.

Even with the peak pre-deadline buying over, prices should continue rising in the short term although at a slower rate than beforeaccording to Martin Ellis, Halifax housing economist.

“Current market conditions remain very tight as the severe imbalance between supply and demand persists. This situation, combined with low interest rates and rising employment and real earnings, should continue to push house prices up over the coming months [but] weakening sentiment regarding house price prospects and a dip in consumer confidence, however, suggest that annual house price growth may ease” he says.

Former RICS chairman and north London estate agent Jeremy Leaf, says politics may lead to a temporary slowdown in activity, too. 

“This easing of growth in prices is a trend that is likely to continue for the next few months at least until after the EU referendum. As investors pause for breath, their withdrawal from the market is giving first-time buyers a better opportunity to take that first step on the ladder than they have had for some time” he says.