House prices in Britain fell by 1% in March as the end of the stamp duty holiday put people off buying, a report by Nationwide has found.
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Getting on the property ladder is harder than ever for most people, with low wages and the high cost of living making it hard to save enough for a deposit.
The House Price Index for March has been released by Nationwide Building Society. It revealed that the average price of a home in Britain fell by 1% compared to February.
It is the largest fall in two years, putting the price of a typical home at £163,327. It is also the first time in six months that house prices are lower than a year ago – down 0.9% on March 2011.
“A slowdown was to be expected, given the imminent expiry of the stamp duty holiday, which had provided a temporary boost to house prices in early 2012 as buyers brought forward purchases that would otherwise have taken place later in the year,” said Robert Gardner, Nationwide’s Chief Economist.
The stamp duty holiday is estimated to have helped 180,000 first time buyers get a foot on the property ladder, with many rushing to secure a deal before the end of the concession.
“This dampening effect on housing market activity and prices may fade over the course of the summer, especially if the wider economic outlook begins to improve and other policy measures, such as the Government’s NewBuy scheme are successful in supporting buyer demand,” added Mr Gardner.
“However, in our view the challenging economic backdrop is likely to continue to act as a drag, with house prices moving sideways or modestly lower over the next twelve months.”