House prices fell by 1.0% in March and are predicted to continue to drag over the next 12 months.
Figures from Nationwide show that at the end of the month, the average price of a home was £163,327 – a fall of 0.9% on the same point last year.
A slowdown in the property market had been expected because of the end of the stamp duty holiday on 24 March.
The temporary relaxation of the 1% tax on homes worth between £125,000 and £250,000 had given the market and house prices a boost in the early months of 2012 as buyers pushed forward in their efforts to buy.
The removal of the stamp duty holiday for first time buyers purchasing a property up to the value of £250,000 was confirmed in the Budget.
Around 180,000 first time buyers have benefited from the stamp duty holiday since its introduction in March 2010, although it is difficult to truly assess the true effect of the initiative as many of the deals would have been regardless of the stamp duty holiday.
The reintroduction of the tax is expected to raise around £600 million in revenues over the next 12 months.
"This dampening effect on housing market activity and prices may fade over the course of the summer, especially if the wider economic outlook begins to improve and other policy measures, such as the Government's NewBuy scheme are successful in supporting buyer demand," said Robert Gardner, chief economist for Nationwide.
"However, in our view the challenging economic backdrop is likely to continue to act as a drag, with house prices moving sideways or modestly lower over the next twelve months."
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