Rate of annual house price growth drops sharply following stamp duty cliff edge
Average UK house prices increased by 3.5%, to £265,000, in the 12 months to April 2025, down from 7.0% in the 12 months to March 2025, according to official data published today.
This is the first slowing of UK annual house price inflation since December 2023 — and was caused by a price fall between March 2025 and April 2025, which coincided with Stamp Duty Land Tax (SDLT) changes.
Average house prices increased to £286,000 (3.0%) in England, £210,000 (5.3%) in Wales, and £191,000 (5.8%) in Scotland in the 12 months to April 2025.
The average house price for England was £286,000 in April 2025. This is up 3.0% (£8,000) from a year earlier. This annual rise was lower than in the 12 months to March 2025 (7.3%).
The average house price for Wales was £210,000 in April 2025. This is up 5.3% (£10,000) from a year earlier. This annual rise was higher than in the 12 months to March 2025 (4.3%).
The average house price for Scotland was £191,000 in April 2025. This is up 5.8% (£10,000) from a year earlier. This annual rise was higher than in the 12 months to March 2025 (5.2%).
The average house price for Northern Ireland was £185,000 in Quarter 1 (Jan to Mar) 2025. This is up 9.5% (£16,000) from Quarter 1 2024.
Meanwhile, average UK monthly private rents increased by 7.0% in the 12 months to May 2025. This was down from 7.4% in the 12 months to April 2025 and represents the fifth consecutive month of slowing annual inflation.
Chris Barry, Director at Thomas Legal, said: “The sharp drop-off in average house prices is a result of the stamp duty cliff edge. The first few months of 2025 were exceptionally busy and that sent prices up, but then the inevitable lull kicked in. The UK will undoubtedly see a few months where the market regathers itself before things potentially start to pick up again in the Autumn. This morning's inflation data doesn't help, as a rate cut tomorrow is almost certainly now off the table. Borrwers needed a break but are unlikely to get one.”
Justin Moy, Managing Director at EHF Mortgages, added:
"A slowdown was always on the cards given the efforts by most buyers to move before the stamp duty threshold changes. In isolation, it's hard to plot the next few months data, but when costs of moving home increase, and mortgage rates are also increasing a little in addition to unemployment also worsening, don't be suprised to see the market flatline soon."
While Emma Jones, Managing Director at Whenthebanksaysno.co.uk commented:
"This data says everything you need to know about how stamp duty tweaks can impact the property market and average prices. With the economy contracting, unemployment rising and an interest rate cut unlikely this week, the summer may be flatter than many had hoped."
Craig Fish, Director at London-based broker, Lodestone, also said the stamp duty changes played a role but is uncertain about the outlook for the property market, even as the weather improves.:
“This slowdown was expected after the SDLT changes and isn’t cause for alarm on its own. But the wider outlook is far from certain. Rising unemployment, global tensions and stubborn inflation mean a base rate cut looks unlikely any time soon and that all weighs on buyer confidence and affordability. Despite the brighter weather, the housing market could still face some gloomy months ahead.”
Much the same verdict was delivered by Harry Goodliffe, Director at HTG Mortgages, who said: “The stamp duty deadline gave the market a rush, and now we’re crashing. A drop-off in growth was always on the cards after such an artificial surge in demand. But let’s not pretend stamp duty is the only issue here. Higher mortgage rates, rising unemployment and the threat of inflation hanging around are all chipping away at buyer confidence. It’s not a crash, but it’s definitely a cooling. The market’s taking a breather.”
