House prices fell in May after changes in stamp duty

Friday 06 June 2025 7:32

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The price of a house in the UK dropped a little in May after the market activity fell after the end of the Stamp Duty Holidays earlier this year according to the latest data from the Halifax lender.

The price dropped 0.4 percent in May after an increase of 0.3 percent in April, placed an average value of the British house at £ 296,648.

The annual growth rate also slowed down to 2.5 percent from 3.2 percent in April.

“This small monthly movement refers to the housing market which is mostly stable … [it] It seems that it has absorbed a temporary surge in activities during spring, which is driven by changes in stamp duty, “said Amanda Bryden, Head of the mortgage, Halifax.

Purchase first jumped when the British racing to take advantage of a lower temporary tax in their first home before the two -year policy ended in March.

Plantation agents say that future home price growth will be very dependent on inflation and the Bank of England.

“The main challenge is the affordability – a hypotide tariff, a higher stamp duty and for some people, the increase in private school fees, affects many families who want to move but cannot,” said Amy Reynolds, head of sales at Richmond Housing Agent Antony Roberts, said.

Interest rate increase reaches house prices

The latest Bank of England number shows the amount of the approved hypotek to finance house purchases decreased in April 2025, by 4.9 percent to 60,463.

Mark Harris, Head of the SPF Personal Client’s Hypotek Broker Executive, said: “The cheapest interest rate has begun to rise again with a swap rate path, which sustains their prices, showing an increase in the level of further hypotek in the short term.

“However, the tariff is only part of the picture. The criteria and changes in the hypotencence stress test by lenders such as national and Natwest, following changes in the Bank of England guidelines in March, meaning that tens of thousands of additional loan pounds can now be available for home buyers.”

Savills said that the more relaxed mortgage loan rules could see the buyer offers the first time to increase a quarter in the next five years.

Bryden added: “Prospects will depend on the rate of interest rates, as well as the strength of future income growth and broader inflation trends.

“Despite the sustainable pressure on household finances and economic backgrounds that are still uncertain, the housing market has shown the durability of the stories that we expect to be brought up in the coming months.”