"Activity is likely to pick up steadily as the summer progresses, despite wider economic uncertainties in the global economy, since underlying conditions for potential home buyers in the UK remain supportive"
- Robert Gardner - Nationwide
The latest data released by Nationwide this morning has revealed that the annual rate of house price growth remained stable in March at 3.9%, unchanged from February.
Northern Ireland remained the top performing area, with annual price growth accelerating to 13.5%, while London was once again found to be the weakest performing region, with 1.9% year-on-year rise.
Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said: “UK house price growth remained stable in March at 3.9%, the same as in February. There was no change in prices month-on-month, after taking account of seasonal effects. These price trends are unsurprising, given the end of the stamp duty holiday at the end of March (transactions associated with mortgage approvals made in March, especially toward the end of the month, would be unlikely to complete before the deadline).
“Indeed, the market is likely to remain a little soft in the coming months since activity will have been brought forward to avoid the additional tax obligations – a pattern typically observed in the wake of the end of stamp duty holidays.
“Nevertheless, activity is likely to pick up steadily as the summer progresses, despite wider economic uncertainties in the global economy, since underlying conditions for potential home buyers in the UK remain supportive.
He added, “The unemployment rate is low, earnings are rising at a healthy pace in real terms (i.e. after accounting for inflation), household balance sheets are strong and borrowing costs are likely to moderate a little if Bank Rate is lowered further in the coming quarters as we and most other analysts expect.
House price growth steady across most regions in first quarter of 2025
“Our regional house price indices are produced quarterly, with data for Q1 (the three months to March) indicating that annual house price growth in most regions remained broadly similar to last quarter," explained Gardener, “Northern Ireland, the strongest performer, was a notable exception, with annual price growth accelerating to 13.5% more than double the pace of the next fastest outturn in Q1 and the highest recorded in the region since 2021, though similar to the robust rates of growth seen in border regions of Ireland in recent quarters. Scotland saw a 3.9% annual rise, while Wales was close behind at 3.6%.
“Across England overall, prices were up 3.3% year-on-year, similar to the 3.1% annual rise seen last quarter. The north-south divide in house price performance persisted, with prices in Northern England (comprising North, North West, Yorkshire & The Humber, East Midlands and West Midlands) up 4.9% year on year, outperforming southern England. Indeed, the North West was the best performing English region, with prices up 5.9% year on year.
He added, “Southern England (South West, Outer South East, Outer Metropolitan, London and East Anglia) saw a more modest 2.5% year-on-year rise. The Outer South East was the best performing southern region with annual price growth of 3.0%. Meanwhile, London was the weakest performing region in the UK as a whole, with annual growth of 1.9%.
Property type update
Gardener concluded, “Our most recent data by property type reveals that semi-detached houses have seen the biggest percentage rise in prices over the last 12 months, with average prices up 4.8% year on year.
“By contrast, flats saw a slowing in annual price growth compared with last quarter, with a 2.3% rise. Detached properties recorded a 4.5% annual increase, while terraced properties saw a 4.1% year-on-year rise.”
Tom Bill, head of UK residential research at Knight Frank, said: “House prices were supported by the stamp duty deadline in the first quarter of the year, but we expect a dip in activity as demand effectively resets from April.
"Buyers coming back into the market with a re-levelled playing field will find that supply is strong, which should keep downwards pressure on prices. Activity should recover by the summer, but borrowing costs could be held higher for longer by erratic US trade policy and the inflationary impact of measures like the employer national insurance changes.”
Nathan Emerson, CEO of Propertymark, said: “The housing market has witnessed an extremely encouraging start to the year with sustained house price growth year on year. Although we now sit at the very start of the amended Stamp Duty thresholds for people across England and Northern Ireland, we remain optimistic to see strong market momentum across the entire UK, as we head towards the traditionally busy summer months.
“Although we are still seeing fluctuations within the rate of inflation, and a much-needed cautious approach from the Bank of England regarding base rates, we are starting to see enormously welcome sub-4 per cent mortgage deals offered by some lenders. As we hopefully witness potentially further base rate cuts across the year, it would be encouraging to see this translate into yet more competitive mortgage products being widely offered.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “Latest figures from this consistently reliable snapshot of housing market activity reinforces what we have seen on the ground – the overwhelming majority of buyers and sellers who had decided to move are coming to terms with the loss of the stamp duty saving by trying to split higher costs between them.
"As a result, and with many sales brought forward, there will inevitably be fewer but more protracted transactions over the next few months. However, bearing in mind around a third of total annual stock is made available during March, April and May, prices are likely to soften, rather than correct, while that underlying strength and confidence in the market remains."
Iain McKenzie, CEO of The Guild of Property Professionals, said: “The latest Nationwide HPI data confirms what we’ve seen in recent months – a market buoyed by strong buyer demand, increased sales activity, and an influx of new listings. The surge in transactions ahead of the Stamp Duty changes has undeniably driven momentum, supporting steady price growth.
“While some may have hoped for a last-minute policy shift, the new Stamp Duty thresholds are now in effect. Naturally, we expect a period of adjustment as buyers and sellers recalibrate their plans. However, with improving mortgage rates and continued earnings growth, the market remains well-placed for stability.
“The resilience of the housing sector is clear, and we anticipate continued good levels of activity throughout the year. The focus now must be on ensuring a balanced and sustainable market that supports buyers and sellers alike.”
Matt Thompson, head of sales at Chestertons, says: “Despite the rush of first-time buyers entering the market to beat the stamp duty deadline having slowed down, sellers anticipate a busy spring market. We have seen an increasing number of homeowners listing their property for sale in March, which is currently creating a greater choice for house hunters. Still, with London having one of the most competitive property markets in the world, buyers are required to act fast and start their search as early as possible.”
