First-time buyers face doubled stamp duty costs from April 2025

In England and Northern Ireland, prospective homebuyers are on a tight deadline as the deadline to finalize property purchases before a significant increase in stamp duty costs arrives on April 1, 2025. Rightmove has analyzed the financial implications of the rising stamp duty, revealing that first-time buyers making purchases around the £625,000 mark will experience substantial additional costs if they miss this critical date. The change in rates will see the current 'nil rate' band of £250,000 reduced to £125,000, impacting many buyers trying to enter the housing market. As homebuyers scramble to finalize deals, figures indicate a notable rise in engagements before the impending deadline, with many agents reporting heightened activity in the market. Research from Barclays highlights that buyers expect to incur an average of £6,512 in extra fees if their property transactions are not completed by the deadline. Moreover, a recent Opinium survey shows that 40% of buyers cite deposit costs as the largest barrier to home ownership, with many younger individuals, particularly from Generation Z, actively seeking side jobs to boost their savings for deposits. The urgency of the situation has led solicitors and conveyancers to work continuously to ensure that home sales are completed on time. While certain areas in the South of England, particularly London, are poised to feel the most significant impact due to higher property prices, there is still a market for affordable homes. Rightmove states that only 9% of homes on the market in the capital are priced under the £300,000 threshold, a stark contrast to 27% that are currently below the £425,000 zero stamp duty threshold. In contrast, the North East faces a different scenario, with 74% of homes still under the threshold as the deadline approaches. The changes to stamp duty are not anticipated to yield a major drop in market activity post-deadline, as agents are preparing for a continuing high demand during the spring months. However, the rise in stamp duty may deter some buyers, limiting options for future purchases, particularly for those unprepared for the sudden shift in costs. Assisting prospective homeowners in coping with the impending stamp duty adjustments, some lenders are introducing mortgage programs with attractive features, such as cash incentives to buffer the financial impact of the upcoming tax increases, showing an effort to maintain a vibrant market despite the challenges ahead.