The UK housing market has been clawing its way back since September 2022. It was then
that Liz Truss lobbed out her mini-budget and tanked markets. Since then, even with
incremental recoveries noted, a new government has brought new uncertainties. This can be seen
reflected in the housing market. En route to the October 2024 budget, house
price rises simmered down a bit.
With the budget came an eyebrow-raising inclusion. Stamp duty will be lowering its brackets.
Instead of home buyers being able to avoid stamp duty on properties worth up to £250,000,
they’ll now need to pay the tax on those worth over £125,000. This pivotal change comes into
play in April 2025. So, what are UK buyers to do in the meantime?
While the Going is Good.
As noted, house prices have gone up over the last couple of years. In fact,
MoneyWeek.com reports that half of UK homes increased in value in 2024. Prices dipped in
December by 0.2 per cent month-on-month, but 15 million increased throughout the year by
at least one per cent. To close the year, the average price of a UK home clocked in at
£297,166. In December 2022, that figure was £294,000.
Small increases are always susceptible to hits as people are less sure-footed about the future.
Headlines on interest rates, inflation, and taxation always have a heavy influence. This is why
CNBC.com expects there to be a rush on the property market through to April. Getting in and
settled before stamp duty changes is key for many. With a rush of interest, the market will be
more competitive. Thus, house prices should go up.
The problem with this, as is so often the case, is the chain. People looking now want to sell
and likely move with the current owners moving within a couple of months. Of course, there
are ways around this. Buyers like Sold.co.uk skip the chain. People get to sell in their own
timeframe after getting a free cash offer. Without any hidden fees, users of the service can
know exactly what their budget is and then attack the market without lag.
Other Key Points to Note
Before you decide to sell and move, there are other factors to consider. The first is that
forecasts see property values increasing by an average of around 2.5 per cent across 2025.
Next, the UK housing market has been hailed as “remarkably resilient” throughout a
turbulent year. From there, keep 6 February in mind. This is when the Bank of England will
review its base rate again.
The base rate is what the Bank of England charges as its interest rate to other lenders. This
percentage is invariably passed down to the consumer. So, everyone’s hoping for another
decline in the base rate. Things are going in the right direction for this. After all, the inflation
rate dipped to 2.5 per cent in December 2024. Finally, it’s good to keep in mind that the
government is actively working to build more houses. 1.5 million homes by 2030, that is.
There will be a rush to sell before April 2025. It doesn’t mean that you have to do so. Yet, if
you’ve been looking to move, doing so before stamp duty rises would be wise.
