Nationwide issues warning to anyone thinking of selling their house

UK house price growth has slowed - but stamp duty changes will spark a buyer rush. Nationwide has issued an urgent warning to people thinking of selling their house - explaining how it predicts a buyer rush before spring in the wake of the Labour Party Budget.

The building society’s monthly index showed that annual house prices grew at a rate of 2.4% in October, a slowdown from the near two-year high of 3.2% recorded in September. Robert Gardner, Nationwide’s chief economist, says Labour Chancellor Rachel Reeves' decision to remove the temporary increase to the nil rate for stamp duty next April could spark a rush to complete purchases before the changes.

Gardner said: “The main impact of the stamp duty changes is likely to be on the timing of property transactions, as purchasers aim to ensure their house purchases complete before the tax change takes effect. This will lead to a jump in transactions in the first three months of 2025 (especially March), and a corresponding period of weakness in the following three to six months, as occurred in the wake of previous stamp duty changes.”

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Mr Gardner, chief economist at Nationwide, said: “The price of a typical UK home increased by 2.4% year on year in October, though this represented a modest slowdown from the 3.2% pace recorded the previous month. House prices rose by 0.1% month on month in October, after taking account of seasonal effects.

“Housing market activity has remained relatively resilient in recent months, with the number of mortgage approvals approaching the levels seen pre-pandemic, despite the significantly higher interest rate environment.” He added: “Solid labour market conditions, with low levels of unemployment and strong income gains, even after taking account of inflation, have helped underpin a steady rise in activity and house prices since the start of the year.

“Providing the economy continues to recover steadily, as we expect, housing market activity is likely to continue to strengthen gradually as affordability constraints ease through a combination of modestly lower interest rates and earnings outpacing house price growth.”