House sales plunge as stamp duty holiday ends

In April 2025, the UK experienced a significant drop in residential transactions, recording only 64,680 house sales according to estimates from HM Revenue & Customs, marking a 64% decline from March's total of 177,440 sales. This downturn followed a rush of activity in the preceding months as buyers aimed to take advantage of a temporary stamp duty holiday, which allowed exemptions on properties valued up to £425,000. The urgency created by the approaching deadline led to an unusually high number of purchases in March, with lenders reporting their busiest month ever as buyers sought to finalize deals before the tax change took effect. The end of the stamp duty exemption in early April was a key factor in the drastic contraction of the housing market, revealing the intricate relationship between fiscal policy changes and buyer behavior. In addition to the slump in transactions, April sales were 28% lower than the 89,860 sales recorded in April 2024, further highlighting the impact of the stamp duty adjustments on the housing market dynamics. Notably, this downturn in sales occurred as households grappled with ongoing economic uncertainties and fluctuating interest rates. Despite the abrupt decrease in sales, experts suggest that the housing market retains a degree of resilience. According to Jason Tebb, president of property platform OnTheMarket, while transactions plummeted in April following March's frenetic pace, subsequent interest rate reductions have bolstered confidence among buyers and sellers. He observed that even without the stamp duty concession, a resurgence in sales activity was noted, marking the fastest pace in four years due to lenient affordability testing for mortgages, a larger pool of active buyers, and an increase in available homes for sale. Richard Donnell, executive director at Zoopla, indicated that the current figures are a reflection of the rush to benefit from the stamp duty holiday while also noting a lull in new sales during the Easter period. Yet, he remains optimistic about the recent uptick in sales agreements, attributing it to a more favorable lending environment. With these insights, it is clear that while the removal of the stamp duty holiday has caused a short-term decline, factors like reduced interest rates and economic recoveries could pave the way for a resurgence in the housing market in the coming months.