House prices have recently taken a downward turn, with new data from Nationwide showing a 0.6% drop in property values. The decline follows changes to stamp duty rules that have increased the tax burden for many buyers, prompting a rush to complete purchases before the new thresholds took effect.

Despite the monthly fall, property prices remain 3.4% higher than they were this time last year, with the average UK home now valued at £270,752. Nationwide’s chief economist, Robert Gardner, noted that a surge in transactions occurred just before the new stamp duty rules began, as buyers acted quickly to avoid the extra costs. He expects the housing market to remain subdued in the near term.

The recent tax changes mean homebuyers in England and Northern Ireland now pay stamp duty on properties above £125,000, rather than the previous £250,000 threshold. First-time buyers are also affected, now paying the tax on homes priced over £300,000, down from the former £425,000 threshold.

Meanwhile, falling mortgage rates and increased lender competition have sparked cautious optimism. More low-deposit deals are now available than in years, giving first-time buyers more options. Experts suggest further interest rate cuts could help support demand, especially as market conditions stabilise and affordability gradually improves.