The latest house price index from the Nationwide Building Society has revealed that UK house price growth slowed in April.
The annual rate of house price growth fell from March’s figure of 5.7% to 4.9%.
The rise in stamp duty at the beginning of April saw a rush to get deals done in March. A record of 165,000 transactions took place, around 11% higher than the previous high seen in January 2007.
The increase in stamp duty also saw mortgage-lending rise steeply. In March lending reached nearly £26Bn, an increase of 43% on February’s figure of 18Bn.
April saw the price of house increase by only 0.2%, which is lowest monthly increase since November last year.
The average cost of a UK house in April according to the Nationwide now stands at £202,436. The previous month saw the average cost come in at £200,251.
Robert Gardner, Nationwide’s Chief Economist, commented: “It may be that the surge in house purchase activity resulting from the increase in stamp duty on second homes from 1 April provided a temporary boost to prices in March.
“However, it is possible that the recent pattern of strong employment growth, rising real earnings, low borrowing costs and constrained supply will tilt the demand/supply balance in favour of sellers and exert upward pressure on price growth once again in the quarters ahead.
“House purchase activity is likely to fall in the months ahead given the number of purchasers that brought forward transactions. The recovery thereafter may also be fairly gradual, especially in the BTL sector, where a wealth of other policy changes, such as the reduction in tax relief for landlords from 2017 are likely to exert an ongoing drag.”