UK house prices have suffered their steepest decline in a year as the market cools after a buyer rush to beat changes to stamp duty changes in England and Northern Ireland.

The average price of a property fell by 0.5% last month to £296,699, the steepest decline in value since March last year, according to Halifax.

It is the second consecutive month that house prices have fallen, as Britain’s biggest mortgage lender revised February’s decline from 0.1% to 0.2%.

However, prices in March this year compared with the same month last year were up by 2.8%, the same pace of annual increase as seen in February.

The expiry at the end of March of temporary tax incentives for buyers of less expensive homes as well as for first-time buyers encouraged buyers to move ahead more quickly with their plans in the months leading up to the change.

Last week, another mortgage lender, Nationwide, said its measure of house prices was flat in March and it expected the market to remain soft in the coming months.

Amanda Bryden, head of mortgages at Halifax, said demand was returning to normal levels after the rush created by the tax change deadline and new applications for loans were slowing.

“Looking ahead, potential buyers still face challenges from the new normal of higher borrowing costs, a limited supply of available properties to choose from, and an uncertain economic outlook,” Bryden said.

“However, with further base rate cuts anticipated alongside positive wage growth, mortgage affordability should continue to improve gradually, and therefore we still expect a modest rise in house prices this year,” she said.

Recall that the  chancellor, Rachel Reeves, announced in her October budget the end of temporary stamp duty cuts in England and Northern Ireland from April. Scotland and Wales set different taxes on house purchases.

From April 1st,  first-time buyers in England and Northern Ireland have to pay tax on homes worth more than £300,000, down from £425,000, and the threshold for a reduced rate for first-time buyers will drop from £625,000 to £500,000.

The zero-tax stamp duty threshold that applies to all housing in England and Northern Ireland has dropped from £250,000 to £125,000.

According to an analysis by Moneyfacts in the latest market, Mortgage rates have slightly dipped compared with last week.

The average two-year fixed mortgage rate is 5.32%, down from 5.33% on Friday. The average five-year fixed mortgage rate is 5.17%, a slight improvement on the 5.18% rate on Friday.