The UK property market trends are shifting as a decade-high number of homes flood the market this spring. Despite a rush to beat the stamp duty deadline, sellers are keeping price increases in check, creating a buyer-friendly landscape, according to the latest Rightmove report.
This month, the average asking price of a home in the UK rose by 1.1% (£3,867) to £371,870, aligning with the usual March trends. However, many sellers are adopting realistic pricing rather than inflating their expectations, Rightmove stated.
Stamp Duty Deadline Fuels Market Activity
The market is experiencing a surge in activity as buyers scramble to complete purchases before the stamp duty thresholds revert at the end of March. Introduced in September 2022, the temporary stamp duty relief helped boost affordability, but its expiration could see buyers paying thousands more in tax.
Currently, around 575,000 property transactions are still progressing through legal completion, adding to market congestion. Additionally, 74,000 deals—including 25,000 first-time buyers—are expected to miss the deadline, collectively facing an extra £142 million in stamp duty costs.
Colleen Babcock, a property expert at Rightmove, commented:
“The hope of a stamp duty deadline extension is fading, but with the Chancellor’s Spring Statement on 26 March, there is still an opportunity for a short extension to assist these buyers.”
Market Remains Resilient Despite Economic Uncertainty
Despite global economic fluctuations, the UK property market has remained stable. The number of agreed sales is up by 9% compared to 2024, while new listings have increased by 8% year-on-year. However, mortgage rates continue to impact affordability.
The average five-year fixed mortgage rate currently stands at 4.74%, significantly lower than the 6.11% peak in July 2023 but only slightly below the 4.84% recorded last year.
Matt Smith, Rightmove’s mortgage expert, said:
“Economic turbulence is affecting mortgage rates, leading to small fluctuations weekly. Those with smaller deposits are feeling the strain the most, making it tougher for first-time buyers and those borrowing more.”
The Bank of England is expected to hold interest rates steady at 4.5% following its recent cut, with another reduction likely in May 2025.
Future Prospects: Increased Lending & Market Growth
Rightmove has welcomed proposals from the mortgage regulator aimed at simplifying responsible lending. These include:
- Easing mortgage stress tests to make borrowing easier.
- Improving mortgage processes to help home-movers.
- Exploring ways to increase first-time buyer borrowing capacity.
Meanwhile, a separate report from Savills shows that the UK housing market grew by £22.3 billion last year, reaching a total value of £379 billion, a 6.3% increase.
Notably, first-time buyers accounted for the largest increase in mortgage debt, rising by £12.2 billion (21%). Additionally, for the first time in two years, the South East’s property market (£74.5 billion) overtook London (£72.8 billion).
Lucian Cook, head of residential research at Savills, noted:
“While the market remains below its pandemic peak of £521 billion, it is still £36 billion larger than pre-pandemic levels. Expected interest rate cuts will expand the pool of buyers and enhance spending power over the next 12 months.”
A Buyer’s Market on the Horizon?
With record numbers of homes available, stable mortgage rates, and an evolving lending landscape, the UK property market trends are shifting in favour of buyers. If interest rates ease further and affordability improves, 2025 could be a pivotal year for homeownership opportunities.
