New house price data highlights a big rise in transaction volumes up to the stamp duty rise for first-time buyers – but shows that the impact on market prices has been much more muted.

In May, the average sale price of a home in England and Wales dipped slightly by just 0.1% compared to the previous month—the smallest monthly decline in seven months. On an annual basis, prices fell by 1.4%, bringing the average home value to £357,913.

The plummeting transaction figures amid this aftershock are likely to continue for some months, with evidence suggesting that sellers and buyers have been settling on lower prices to compensate, in part, for the higher tax burden.

Rob Owens, head of research at e.surv, comments: “Despite the tax-driven slowdown, there are signs of resilience. Eased mortgage affordability rules and expectations of falling interest rates could help offset affordability pressures, especially in the South.

“Looking ahead [today’s] Spending Review may bring new housing policy announcements, including potential boosts to affordable housing and support for first-time buyers.

“While the market remains soft in the short term, these developments suggest a more positive outlook for the second half of 2025.”

Regionally, London continues to experience the steepest declines (-5% annual change), though the pace of these falls is easing. Meanwhile, northern regions and the Midlands, which had previously hit record highs, are now seeing slight price corrections.