House prices fell by 0.3% in January
House prices fell for the first time in seven months in January after the government ended stamp duty relief measures.
Property prices fell 0.3% in the first month of this year, according to the Halifax House Price Index. Economists polled by Reuters had expected a 0.3% rise.
According to Nationwide, the average price of a house in the UK is now £229,748.
Robert Gardner, chief economist at Nationwide, outlined the impact of the stamp duty relief and predicted a slowdown in the housing market in the coming months.
Gardner said: “The economic slowdown probably reflects waning demand ahead of the stamp duty holiday, with many people considering moving to bring forward their purchases.” said.
“If the stamp duty holiday ends as planned and labor market conditions remain weak as most analysts expect, housing market activity is likely to slow, possibly sharply, in the coming months.”
In the aftermath of the first coronavirus lockdown, demand surged thanks to the temporary lifting of property purchase tax.
Tom Bill, head of UK housing research at Knight Frank, warned of the economic impact of a sudden withdrawal of the policy.
Bill said: “The prudent option would be to scale back furlough and avoid a cliff moment for the housing market across the economy, especially given how important labor mobility will be in the coming months.” Ta.
