House prices dip by 0.2% month on month in March

House prices edged down by 0.2% month on month in March, according to an index.

Across the UK, the average house price was £232,134, Nationwide Building Society said.

This was a 5.7% increase compared with a year earlier.

Robert Gardner, Nationwide’s chief economist, said: “The slowdown in March probably reflects a softening of demand ahead of the original end of the stamp duty holiday before the Chancellor announced the extension in the Budget.”

The stamp duty holiday had been due to end on March 31, but was extended in the recent Budget.

Mr Gardner continued: “The longer-term outlook remains highly uncertain. It may be that the recovery continues to gather momentum and that shifts in housing demand resulting from the pandemic continue to lift the market.

“However, if the labour market weakens towards the end of the year as policy support is withdrawn, as most analysts expect, then activity is likely to slow nearer the end of 2021, perhaps sharply.”

Nationwide also released figures showing house price growth across the UK’s nations and regions in the first quarter of 2021.

Mr Gardner said: “The North West was the strongest-performing region, with prices up 8.2% year on year. This is the strongest price growth seen in the region since 2005 and average prices reached a record high of £181,999.”

London was the weakest-performing region in the first quarter of 2021, with house prices increasing by 4.8%, softening from 6.2% annual growth in the previous quarter.

Mr Gardner added: “The South West was the only southern region to see an acceleration in annual price growth, which picked up to 7.2% in quarter one, from 6.6% in (quarter four 2020).”

Tomer Aboody, director of property lender MT Finance, said: “The continued shift in buyers’ demands for more space meant London saw the slowest growth, with prices still very high compared to the rest of the country and space more limited.

“Gardens, communities, green spaces and easy commutes are increasing demand for the outer regions, with prices continuing to rise to reflect this.”

Here are average house prices in UK nations and regions in the first quarter of 2021, and the annual increase in prices:

– North West, £181,999, 8.2%

– West Midlands, £208,806, 7.6%

– Northern Ireland, £154,012, 7.4%

– South West, £263,033, 7.2%

– North East, £138,348, 7.2%

– Wales, £174,777, 7.2%

– Outer South East (includes Ashford, Basingstoke and Deane, Bedford, Braintree, Brighton and Hove, Canterbury, Central Bedfordshire, Chichester, Colchester, Dover, East Hampshire, Eastleigh, East Sussex  Fareham, Folkestone and Hythe, Gosport, Havant, Isle of Wight, Maldon, Milton Keynes, New Forest, Oxfordshire, Portsmouth, Southampton, Swale, Tendring, Test Valley, Thanet, Uttlesford, West Berkshire, Winchester and Worthing), £298,804, 7.2%

– Yorkshire and the Humber, £175,577, 7.0%

– Scotland, £159,221, 6.9%

– East Anglia, £242,789, 6.1%

– East Midlands, £200,307, 6.0%

– Outer Metropolitan (includes Buckinghamshire, Hertfordshire, Horsham, Luton, Maidstone, Medway, Mid Sussex, Reading, Rochford, Rushmoor, Sevenoaks, Slough, Southend-on-Sea, Surrey, Thurrock, Tonbridge and Malling, Tunbridge Wells, Windsor and Maidenhead and Wokingham), £379,058, 5.6%

– London, £482,576, 4.8%