Property prices in the UK fell slightly last month.

That’s according to the most recent data from the Halifax. The dip was slight – from £298,274 in February to £296,699 in March. 

That meant a monthly drop of 0.5%. However, year-on-year, prices were up 2.8%.

Regionally, the highest annual property growth in England was in Yorkshire and the Humber, with a monthly increase of 4.2%. In Scotland it was 4.3% and Wales 3.7%. Northern Ireland had the highest jump, at 6.6% growth for the average property there.

Twice as many properties sold in March

A spokesperson for the Halifax said the market was now returning to normal after the Stamp Duty rush. 

“Our customers completed more house sales in March than in January and February combined, including the busiest single day on record,” she added.

Despite this, many property analysts remain hopeful that future mortgage interest rate cuts will result in a bustling market again. That’s because the Bank of England is expected to cut it is base rate several times later this year. Wages are also expected to go up.

Good news for future fixed deal mortgage rates

Mark Harris, chief executive of mortgage broker SPF Private Clients, also brought in a glimmer of optimism for would-be buyers. He said Donald Trump’s tariffs had increased the likelihood of better mortgage deals. 

He explained: “If this continues, lenders could respond with a flurry of five-year fixed rates starting with a three as opposed to the current position of only one or two [mortgage rates] priced under 4%.”

All areas see an annual rise in prices

After Yorkshire & the Humber, the next biggest property price rises in England were in the North West (3.8%), West Midlands (3.3%), East Midlands (2.9%), the North East (2.3%) and South East (2%). In Eastern England prices increased by 1.7%, while in London the jump was 1.1%. The rise was lowest in the South West, with just 1%.

From this week, councils in England can now charge higher council tax rates on second homes. 

And around two thirds of local authorities in the country are set to do just that, as part of the Levelling-up and Regeneration Act introduced last year.

In some cases, second home owners could face a council tax bill of around £10,000, thanks to new powers to raise a second homes levy by 100 per cent. Having said that, most owners will be looking at a 77 per cent rise, resulting in an additional £3,672 for the following tax year.

Second home owners in Cornwall to be badly hit

Owners in seaside resorts, such as Cornwall, will be funding the council’s coffers by millions. That’s because there are 14,123 second or ‘holiday’ homes in the town.

In Rutland, near London, second home owners could be looking at a £10,684 increase of their council tax.

Council in popular seaside spots in particular hope the increased tax on second homes will lead to many owners selling up, leaving the property for locals to buy. 

Tenby – a case in point

Judging by the experience of Pembrokeshire Council Council in Wales, however, that isn’t likely to be the case. Their 200 per cent premium on second homes in Tenby resulted in nearly a quarter of all properties in the town lying empty as owners sold them on. 

And, although the town has seen property prices fall – by as much as 8.9 per cent – it’s still not enough for locals to be able to afford to buy. That’s because the average property is still around £273,000.

Councillors admit they ‘went too far’

In an attempt to stem the rate of growth of empty second homes in the town, the council has now reduced the premium to 150 per cent. 

But some local businesses say it may be too late. They’ve already suffered financially by the loss of tourist trade from second home owners. They’re also wondering if the town will ever fully recover. English local authorities should definitely take note.

The rush to purchase property before the Stamp Duty cut-off next month is reflected in recent house price growth.

According to the Nationwide Building Society, property prices in the UK jumped 0.4% between January and February. And that figure is expected to increase even higher as buyers attempt to conclude their property transaction before the April 1 deadline. Incidentally, around 25,000 first-time buyers in England are expected to miss it, says Rightmove.

Right now, the average property price in the UK is £270,493, according to Nationwide’s latest findings.

The rise in property prices is the sixth increase in a row and a 3.9% annual rise. 

Economist Ashley Webb of Capital Economics, believes it isn’t just the forthcoming Stamp Duty change that is increasing the value of property. The statistics, he said, implied that buyers were undeterred in general. To the extent that…”the housing market continues to shrug off both the weak economy and the recent rises in mortgage rates,” he said.

Flats fall from grace in UK property market

Meanwhile, one area of the market which isn’t faring quite as well as others, is in apartments (or flats). According to Zoopla figures, the values of flats has only grown 7% over the past five years, while houses have gone up by almost a quarter (24%). 

Zoopla’s own analysis blames the period during the pandemic when house owners wanted more space, preferably houses with a garden. Its spokesman says the market in flats still hasn’t recovered from this. This is compounded with the fears over poor cladding in recent years.

Rightmove 4^th most popular website in UK

Meanwhile, a report by online property portal Rightmove showed that a total of 16.4bn minutes was spent viewing properties on its website last year. That was a 6% increase on the previous year, and resulted in the portal being the fourth highest website in the UK for hits. Only the BBC, Reach newspapers and the government’s own website received more visits in the past 12 months.

Property prices grew 4.6% in December year-on-year, according to official government figures. 

Published this week the HM Land Registry price House Price Index also showed an annual increase for November, albeit quite a bit lower at 3.9%.

The figures recorded the average property in the UK at £268,000 for the last month of the year. In terms of price increases, three areas stormed ahead – Northern Ireland, Scotland and the North East. House prices there grew 9.0%, 6.9% and 6.7% respectively. 

No rise for London homeowners

That’s in sharp contrast to London where there was no growth year-on-year in December. And, in fact, property prices fell by 0.3% between November and December 2024. The high property prices in London mean that the least affordable areas of London were still higher than many of the more upmarket areas in the North East.

House values also increased in both England and Wales for the year to December 2024. This was at a lower rate – 4.3% in England and 3% in Wales. 

Stamp Duty changes expected to impact prices

Analysts believe the property growth figures won’t be as spectacular towards the end of 2025. That’s because more homes are coming on to the market and, at the same time, Stamp Duty costs are reverting to their previous figures. That means having to pay stamp duty on properties priced £125,000 and over. First-time buyers will have to start paying tax on homes up to £300,000 (instead of £425,000). Higher-rate tax payers will also see an increase in capital gains tax, up to 24%.

The market is still expected to be busy however, thanks to a stabilising economy and lower mortgage interest rates. Wages have also gone up over the past year.

Yopa chief executive officer, Verona Frankish, said: “We’ve already seen one interest rate reduction so far in 2025 and it’s shaping up to be a year of even greater positivity where the property market is concerned.”

Private landlords in England and Wales could end up forking out thousands of pounds in order to get their properties compliant with new government energy efficiency rules.

Under the government’s Plan for Change initiative all private rental properties will have to meet minimum energy standards by 2030. Government analysts say the costs to upgrade to a new Energy Performance Certificate (EPC) level ‘C’ will cost landlords anything from £6,100 to £6,800.

The proposal is currently out to consultation, with landlords and renters urged to make their feelings known.

A spokesman for the Department for Energy Security and Net Zero said the move could benefit renters by cutting back their fuel bills to the tune of £240 a year.

Landlords to look at solar panels and cavity wall insulation

In order to remain complaint with the proposed legislation landlords will have to invest in double glazing, cavity wall insulation and other measures to ensure tenants remain warm in their homes. Solar panels and smart meters may also be considered.

Deputy Prime Minister and Housing Secretary Angela Rayner said: “Through our Plan for Change we are driving up housing standards, improving quality of life, and slashing energy bills for working people and families.

Ed Miliband, Energy Secretary, added: “These plans will also make sure that all private landlords are investing in their properties, building on the good work of many to upgrade their homes to Energy Performance Certificate C or higher already.” 

Nearly half of landlords already compliant 

The good news is that around 48% of private rental homes are already compliant with the new proposed government standards. The current EPC standard for private rental properties is ‘E.’

One of the proposals in the consultation is whether to give landlords an additional two years after the 2030 cut-off to get up to standard. Another is to limit the cap for landlords to a cost of £15,000 per property, while a third is to introduce an affordability exemption, limiting the cap to £10,000, for a property with a lower rent or a reduced council tax band.

This week’s decision to hold the Bank of England base rate will put a dent in house sales early next year say estate agents.

That’s because mortgage interest rates will remain the same, meaning property prices will still be out of reach to thousands of would-be buyers. 

Two-thirds of bank committee voted for reduction

The Bank’s Monetary Policy Committee voted 6-3 to retain the rate at 4.75% rather than reduce it by 0.25 percentage points as some economists surmised. Those in favour of retaining the current bank rate said it was necessary in order to manage inflation. The Bank is currently aiming for an inflation target of 2%. Inflation sat at 2.6% last month – 0.3% higher than in October’s figure.

Despite this, many property experts are confident that there will be a fall in the base rate next year, and subsequently a drop in mortgage interest rates. Certainly, buyers and lenders alike will be hoping for a fall in rates as a result of Stamp Duty charges reverting to previous ratios on April 1. 

Mortgage expert at property portal Rightmove, Matt Smith said he expected a typical mortgage interest rate to sit at around 4% by the end of next year. But he added: “This is dependent on the impact of a wide variety of unpredictable factors, including geo-political tensions and inflation.”

Former Royal Institute of Chartered Surveyors (Rics) chairman, Jeremy Leaf said a cut in the base rate would be particularly welcomed by first-time buyers, especially in light of increasing rental rates. 

Scotland tops the league for house transactions

Meanwhile, in terms of property sales, Scotland topped the league for 2024. That’s according to recently released government figures. The Office of National Statistics data shows there were 54,428 property transactions north of the border, equating to 15% of the UK total. 

The next highest region for property sales was the South East, with 14% of the total. Third was the North West, at 11%. Northern Ireland saw least properties sold, with a percentage rate of just 3.4%. Despite this, Belfast was the UK city in which most homes were sold, at 7333 properties. Second was Edinburgh and third, Glasgow. A total of 3994 properties were sold in Leeds, England’s highest city total, outside London.

More than one quarter of surveyors reported a rise in property prices in their region during November. That compared to just 16% of members of the Royal Institution of Chartered Surveyors (Rics) in October.

The statistics bode well for the first few months of next year. That’s when the market is expected to speed up as would-be buyers try to beat the Stamp Duty changes at the start of April.

Property Portal Rightmove’s Tim Bannister reported recently that he expected the whole of 2025 to be a busy year for house transactions, predicting there would be around 1.15 million completed.

But senior economist at Rics, Tarrant Parsons, didn’t share his optimism. He believes currently high interest rates and the broader macroeconomy will still make buyers hesitate on such large purchases.

His concerns are borne out by figures released by the Office for National Statistics this week. The government data showed that the cost of the average property in England last year was 18.2 times above typical household income of £34,569. That was for the year to March last year while, at the same time, the typical property was valued at £298,000 – a ratio of 8.6. For poorer households the ratio was 18.2.

Mortgage rates to fall next year

Fixed mortgage rates are currently around 4.83% and 5.08% per cent for five-year and two-year products respectively. It’s expected these will reduce to around 4% by the end of 2025. They may even reduce in 2026, but analysts don’t expect them to fall to pre-cost of living rates. The expectation they will fall though is prompting more people to take out two-year mortgages.

More first-time buyers than last year

Rightmove reports there are 13% more first-time buyer enquiries than there were at the same time last year. Rents continue to rise, although Rics reported a 1% drop in enquiries list month. This may, of course, be due to the time of year.

In order to battle the house crisis Sir Keir Starmer has recently vowed to build 300,000 new homes annually. The previous Conservative government promised similar construction figures but 200,000 was the highest number of homes built in any one year.