But all's not lost for Spring buyers who miss the deadline
More than 500,000 UK homebuyers are working to finalise purchases before Stamp Duty thresholds change in April, according to property website Rightmove.
The 575,000 homes currently in the legal completion process represent around half of the 1.15 million total transactions expected this year. Rightmove reported that this figure marks a 21% rise from the same period last year and is the highest since 2022, when the market was still buoyed by post-pandemic activity.
With a backlog of transactions underway, approximately 74,000 buyers are expected to miss the deadline, Rightmove estimates. Those who complete after March 31 could face thousands in additional tax costs, with some paying more than £11,000 extra.
Rightmove has reported that the average asking price for homes coming to market in March has increased by 1.1%, or an equivalent of £3,876, to £371,870, in line with historical trends for the month. Rightmove’s data suggests that March is typically one of the strongest months for sellers, as properties listed in February and March have historically had the highest likelihood of finding a buyer.
However, competition is particularly high this year, with the number of properties available reaching a decade-long peak. Buyers, in turn, have the widest selection of homes to choose from since 2015. Those unable to complete before April will lose out on the current stamp duty savings but may benefit from the increased supply.
“The big milestone ahead in England is the Stamp Duty deadline, and with a massive log-jam of 575,000 moves going through the legal completion process, many cost-conscious buyers will be doing all they can to get their move over the line and avoid unnecessary extra tax,” said Colleen Babcock (pictured centre), a property expert at Rightmove.
The Rightmove report also suggests that 25,000 first-time buyers are among those who will miss the deadline, collectively incurring an estimated £142 million in extra tax. While hopes for an extension are fading, the upcoming Spring Statement presents a potential opportunity for the government to reconsider the timeline.
Despite concerns over tax changes, market activity remains steady. Sales agreed so far this year are up 9% compared to 2024, while new property listings have risen by 8%. Analysts suggest this could help sustain momentum even after the stamp duty increase takes effect.
Persistently high mortgage rates continue to impact buyer affordability. Rightmove’s mortgage tracker indicates that the average five-year fixed mortgage rate currently stands at 4.74%, down from its peak of 6.11% in July 2023 but only slightly lower than 4.84% a year ago.
Regulators are considering reforms to simplify lending criteria, including adjustments to stress testing rules. These changes could help more first-time buyers enter the market, though their impact will take time to materialise.
“The pipeline of sales going through the completion process, as well as new sales being agreed, are signs of the strength of the important Spring housing market,” Babcock said. “It’s encouraging to see new activity continue to track above last year’s level.”
David Morris (pictured left), head of homes at Santander UK, also highlighted the rush to complete transactions.
“The difference of just one day could mean buyers face extra costs of up to £11,250 in taxes,” Morris said. “But, the end of the Stamp Duty holiday hasn’t seemed to slow the market, with agreed sales up 9% year-on-year.”
Some buyers who miss the Stamp Duty deadline may reconsider their purchases, while others may seek to negotiate lower prices. Estate agents report that sellers remain motivated, which could lead to price adjustments in the coming weeks.
Jeremy Leaf (pictured right), a north London estate agent and former RICS residential chairman, observed shifting market dynamics.
“One person’s meat is another’s poison,” Leaf said. “Just as taking advantage of the Stamp Duty concession becomes impossible, so the new wave of buyers who tried but failed to find a new home in time are enjoying their best choice for some time.
“We’re expecting some hard bargaining over the next few weeks as buyers and sellers seek to find ‘middle ground’ with sale prices softening but staying close to asking levels as the market continues to bare its teeth.”
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