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UK house prices unexpectedly contracted in March as the stamp duty break came to an end, according to the lender Halifax.
The average house price fell 0.5 per cent between February and March, following a 0.2 per cent fall in the previous month, taking the average cost to £296,699, data showed on Monday.
House prices were up 2.8 per cent from March last year, unchanged from February.
The move contrasts with analysts’ expectations, who had forecast a 0.1 per cent month-on-month rise and a 3.5 per cent annual expansion, according to LSEG polling.
Amanda Bryden, head of mortgages at Halifax, said: “House prices rose in January as buyers rushed to beat the March stamp duty deadline. However, with those deals now completing, demand is returning to normal and new applications slowing.”
The stamp duty holiday, introduced in September 2022 when mortgage rates were rapidly rising, ended in March. House purchases for first-time buyers completed from April 1 will start paying the levy on properties of £300,000 or more, rather than £425,000 at present, with similar changes for non first-time buyers.
Bryden added that buyers continued to be held back by higher borrowing costs, a limited supply of available properties and an uncertain economic outlook.
Figures published last week by the lender Nationwide showed house prices stalled in March.
