UK homeowners face hidden ‘house price crash’ as real values drop
05-30-2025
The market "is at a turning point" and homeowners must price their properties "carefully" an expert has warned.
By Katie Elliott, Senior Personal Finance Reporter based in London
UK homeowners face hidden ‘house price crash’ as real values drop (Image: Getty)
Homeowners face a hidden “house price crash” as property values struggle to keep pace with inflation. According to Rightmove, national house prices grew just 1% in the year to March, while inflation nears 3%, meaning property values have effectively fallen. This could be troubling for many homeowners whose wealth is largely tied up in their properties.
Aneisha Beveridge of Hamptons told the Telegraph: “We’ve essentially seen a house price crash without people realising, in real terms rather than nominal terms.” Labour’s push to make housing more affordable, including measures like doubling council tax on second homes from April 2025, has already started to impact the market. Areas like Cornwall and North Norfolk, where second homeownership is high, are seeing increased supply as owners sell to avoid the higher taxes.
The market "is at a turning point" and homeowners must price their properties "carefully"
Zoopla reported that this has led to a drop in house prices in these regions as demand struggles to catch up. It said: “Double council tax on second homes from April 2025 is boosting supply in areas with a greater share of second homes, such as the South West.”
Stamp duty changes are putting added pressure on the housing market. The threshold for stamp duty dropped from £250,000 to £125,000 and from £450,000 to £300,000 for first-time buyers on April 1. As a result, the average stamp duty bill in England is set to rise by 148%, from £2,979 in 2024 to £7,391 by 2029, according to Hamptons.
This triggered a surge in market activity earlier this year, with buyers rushing to complete sales before the deadline. However, that surge has now given way to a slowdown. Halifax’s latest house price index showed the average UK home dropped by around £1,575 in March, a 0.5% decrease month-on-month.
www.express.co.uk