House prices increased in the beginning of the year.  February marked a relief from declining house prices as first time buyers rushed to the market to choose a new property.  The reason was that there was a major savings in reach of first time buyers by simply buying a property before March 24.  The stamp duty holiday that had been in effect for two years was ending on that date and with it would end the opportunity to save up to 1 per cent of the property value or up to £2,500.

Gordon Fowlis, regional managing director of estate agency chain Your Move, said, “The impending end to the stamp duty holiday galvanised the first-time buyer market in February, and reversed four consecutive months of falling house prices. More buyers decided buying now was preferable to forking out an extra £1,600 after the end of the tax break.

“But the panic to beat the stamp duty deadline was not the only factor behind the recovery in February. Banks and building societies had been tentatively increasing their lending to lower income borrowers, and introducing more mortgages which require smaller deposits."

Homeowners were likely overjoyed at the prospect that there was a change occurring in the market as “for sale” signs were being replaced with signs that marked “sold”.  Equity has faltered and the investment for homeowners into their property has seemed questionable with property values falling.  Some have been plunged into negative equity due to the declines in house prices and area property values.

Whether the house price increase was solely due to the return of first time buyers taking advantage of the stamp duty holiday remains to be seen.  March may also reveal an increase since the savings holiday ended toward the end of the month.  April will be the month when it will be revealed if the market was seeing a change or if the stamp duty holiday was really that valuable in bringing buyers to the market.