House Prices Hit New Record As Buyers Race to Beat Stamp Duty Hike

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The average house price in the UK has risen to hit a record high, says Halifax, as buyers race to beat April's stamp duty increase.

The UK bank's monthly House Price Index reached 514 in November, an increase of 1.3% month-on-month from October and 4.8% on the same time a year ago.

The typical UK property now costs £298,083, a new record.

"Borrowers have shrugged off last month’s spike in inflation and the recent Budget uncertainty to press ahead with their homebuying plans," says Rachael Hunnisett at April Mortgages. "Although market activity often slows in the run up to Christmas, the signs point to a busy winter period as homeowners rush to beat April's stamp duty deadline."

This marks the fifth successive monthly gain for UK house prices, says Halifax, with the annual gain of 4.8% being the biggest increase since November 2022.

"Latest figures continue to show improving levels of demand for mortgages, as an easing in mortgage rates boost buyer confidence. However, despite these positive trends, many potential buyers and movers still face significant affordability challenges and buyer confidence may be tested against a changeable economic backdrop," says Amanda Bryden, Head of Mortgages at Halifax.

Bryden says positive employment figures and anticipated decreases in interest rates are expected to continue supporting demand in 2025.

"This should underpin further house price growth, albeit at a modest pace as borrowing costs remain above the average of a few years ago," she explains.

Bank of England governor Andrew Bailey appeared to condone expectations that the Bank will cut interest rates on four occasions in 2025, bringing the base rate down to 3.75% from 4.75%.

The Bank will retain a sense of caution amidst expectations for UK inflation to rise again in the coming months, evading the Bank's desire to get inflation back to 2.0% sustainably.

Chancellor Rachel Reeves also announced stamp duty increases in the October budget, which some analysts say are spurring demand.

"It’s amazing what a little urgency can do and with stamp duty costs now set to increase from April next year, buyers are acting with a far greater degree of intent which is driving the market forward at pace," says Marc von Grundherr, Director of Benham and Reeves.

Verona Frankish, CEO of Yopa, says there's been an immediate reaction from buyers following the Autumn Budget and this uplift in market activity is driving current house price performance.

"However, those who are keen to complete before stamp duty costs increase really need to be acting sooner rather than later," says Frankish.

Stamp Duty rates are changing from 1st April 2025, when the temporary increases to the thresholds that were put in place in September 2022, are due to come to an end.

Whilst this change will impact everyone planning to move, it's first-time buyers who will be the most affected, warns Alistair Singer at Myhomemove Conveyencing.

Currently, first-time buyers pay no stamp duty when buying a home worth £425,000. This threshold will drop to £300,000, meaning they will go from paying nothing to paying £6,250 on stamp duty.