FIRST-TIME buyers desperate to get on the property ladder before the end of a stamp duty holiday helped house prices jump 2.2% in March, the Halifax has revealed.
The bank said the average house price was £163,803 in March as the number of completed sales rose to its highest level since late 2009 before the threshold for stamp duty fell from £250,000 to £125,000 at the end of the month.
The price was 2.2 per cent higher than the previous month but still 0.1 per cent lower on a quarter-by-quarter basis and 0.6 per cent down on a year earlier.
Martin Ellis, Halifax housing economist, said: “Efforts by first-time buyers to beat the expiry of the stamp duty holiday at the end of March have probably increased sales in recent months and may have helped to support prices.”
Recent research revealed that around four in 10 first-time buyers benefited from the stamp duty concession during the two years it was in place.
The HMRC has said the number of sales in January and February was 14 per cent higher than in the same period the previous year, which is thought to have been boosted by the looming stamp duty deadline.
Despite March’s rise, the average house price was the same as in July 2011 and still significantly below pre-recession peaks of nearly £200,000 amid weak availability of affordable mortgages.
And there are fears that the housing market will continue to suffer as demand falls now that the stamp duty holiday has been removed.
Last month, Nationwide reported a 1 per cent fall in prices in March, reflecting the slowdown in demand as the holiday ended and predicting that prices will head downwards or sideways over the coming year.
There is also added pressure on home owners as several lenders, including the Halifax, have announced hikes to standard variable mortgage rates, adding to the cost of home ownership.