18 June 2025
If you are covering the Government's latest House Price Index, please see the following comment from Karen Noye, mortgage expert at Quilter:
"UK house prices fell sharply in April, with the average property dropping 2.7% in value over the month to £265,000. Despite an annual rise of 3.5%, that figure is down from 7.0% in March but should be interpreted with caution given the recent volatility in the data.
"The steep monthly decline reflects a sharp drop in market activity following the end of the stamp duty holiday on 1 April. Many buyers rushed to complete transactions in March ahead of the change, leading to a distorted surge followed by a significant slowdown in April. HMRC data confirms that residential transactions fell by over 60% month-on-month on a seasonally adjusted basis.
"The ONS has highlighted that April’s house price figures are provisional. Just 44% of HMRC’s expected sales volume had been captured at the time of publication, which increases the risk of future revisions. There is also greater uncertainty around new build prices, which are often slower to be reflected accurately in the index.
"Regionally, Northern Ireland continued to lead the market with annual growth of 9.5%, while Scotland and Wales also posted robust increases. London, interestingly, saw a 2.6% monthly rise, although this is likely due to compositional quirks in a low-volume month rather than a broader recovery. In contrast, regions like the North East experienced steep monthly falls, down 8.1%, reinforcing the volatility in the short-term data.
"Underlying conditions remain challenging. Mortgage approvals for house purchases fell for a fourth consecutive month in April, dipping to 60,500 according to the Bank of England. While fixed-rate deals have eased slightly in recent months, average rates remain well above their pre-2022 levels, keeping affordability under pressure. The Bank of England is widely expected to hold rates steady again at tomorrow’s meeting, meaning mortgage holders are unlikely to see significant drops in borrowing costs in the near term.
"Affordability continues to weigh heavily on demand, particularly for first-time buyers, and the new government’s stance on housing policy and taxation will be key in shaping sentiment as the year progresses."
