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The British real estate prices decreased in almost four years at their fastest monthly pace in April, as the demand for the end of a temporary stamp tax vacation decreased.
Real estate prices decreased by 2.8 percent between March and April, the steepest decline in the month since July 2021, according to the state register published on Wednesday.
The fall brought the average House price to 265,000 GBP and has the annual growth to 3.5 percent, from 7 percent in the previous month, the first slowdown since December 2023.
Aimee North, head of the real estate market indices at the National Statistics Office, said: “The British annual house price inflation was slowed down in April after land tax in England and Northern Ireland was changed.”
The stamp tax thresholds were returned to the level before 2022 on April 1 and increased the costs for many real estate buyers. For example, initial buyers have started to pay the tax for real estate worth £ 300,000 or more, a lower threshold than the previous 425,000 GBP.
The southwest recorded the lowest annual house price increase with only 0.9 percent after a sharp contraction of 3.8 percent against monthly month and provided the average costs of a house to 300,600 GBP.
The official figures indicate that between March and April there is a larger decline in property prices than the decline of 0.6 percent registered by the lender nationwide at the end of April.
In contrast to nationwide, official data includes mortgages of all providers and contain cash buyers.
Some economists believe that the decline in the real estate price is temporary.
Elliott Jordan-Doak, economist in the pantheon macroeconomics of consulting companies, said that the trend was “a relaxation of the activity, which was brought up before the tax change” and not “higher taxes that are carried out after demand”.
“We expect the slowdown to become short when the market normalizes,” he added.
Separate nationwide data stated that real estate prices rose again in May, supported by still strong wage growth and mortgage interests, which went back from their highlights in the summer of 2023.
The ONS data also showed cooling on the rental market, but with the pressure on the tenants as a whole, which will probably continue to continue.
The average monthly private rents in Great Britain rose by 7 percent to 1,339 GBP in the 12 months to May, the fifth month of slowing down the annual kit and the lowest since April 2023.
Louisa Sedgwick, managing director of mortgages at Paragon Bank, said that the tenants will undoubtedly “welcome” the measurement of rents that they remained increased after the record high in the last quarter.
“The range of privately rented houses is still below the level that is observed before pandemic and significantly exceeded by demand, a dynamic in which rents will continue to increase over the inflation rate,” she added.
