House price growth slowed to 5.7 per cent in March from 6.9 per cent in February, the latest figures from Nationwide Building Society reveal.

While average UK prices were down by 0.2 per cent month on month on a seasonally-adjusted basis to £232,134, they were still considerably higher than the £219,583 recorded a year ago.

Looking at the quarterly regional figures, the North West showed the strongest growth with prices up by 8.2 per cent year on year in Q1, building on growth of 8 per cent the previous quarter.

The West Midlands was close behind with growth of 7.6 per cent in Q1, followed by Northern Ireland, the South West, the North, the outer South East and Yorkshire and Humberside, all of which saw prices rise by 7 per cent or more.

London had the lowest growth, but prices still increased by 4.8 per cent to an average of £482,576.

The surrounding outer metropolitan area, which includes Slough, Guildford, Crawley and Chelmsford, recorded growth of 5.6 per cent.

Nationwide chief economist Robert Gardner says: “Given that the wider economy and the labour market has performed better than expected in recent months, the slowdown in March probably reflects a softening of demand ahead of the original end of the stamp duty holiday before the chancellor announced the extension in the Budget.

“Recent signs of economic resilience and the stimulus measures announced in the Budget, including the extension of the furlough scheme and the stamp duty holiday, as well as the introduction of a mortgage guarantee scheme, suggest that housing market activity is likely to remain buoyant over the next six months.

“The longer-term outlook remains highly uncertain. 

“It may be that the recovery continues to gather momentum and that shifts in housing demand resulting from the pandemic continue to lift the market.

“However, if the labour market weakens towards the end of the year as policy support is withdrawn, as most analysts expect, then activity is likely to slow nearer the end of 2021, perhaps sharply.”

SPF Private Clients chief executive Mark Harris says: “The housing market continues to be buoyant, particularly now that the stamp duty holiday has been extended, and buyers are keen to take advantage of the saving.

“Buyer confidence is high in the search for more space, both inside and out, and the realisation that perhaps it is not so essential to live in such close proximity to the office. 

“As lockdown continues to ease and everything opens up once more, the resulting boost to the economy will only serve to enhance this growing confidence in coming months.

“Mortgage rates remain at rock bottom and lenders keen to lend. 

“With first-time buyers, those with small deposits and buyers from overseas returning to the market, improving economic indicators and lending policy broadening – the outlook for the housing market is positive for the rest of 2021.”

North London estate agent and former Royal Institution of Chartered Surveyors residential chairman Jeremy Leaf adds:

“These figures reflect a market pause as many decided meeting the original stamp duty deadline at the end of March would be almost impossible, mainly due to the backlog.

“However, the announcement of the holiday extension and rapid rollout of the vaccine have acted like a shot in the arm and re-energised many, especially those new to the market. 

“This is underpinned by a shortage of available properties even though stock levels have increased lately as owner confidence to invite visitors to their homes has improved.

“Looking forward, we don’t expect too much change other than another rapid dash to take advantage of lower stamp duty for the higher-priced properties, particularly in places like London, before the end of June.”