With mortgage approvals about to rise in the UK, all key homebuyers have started their race to get the best deals on their property before the stamp duty is changed. As per the latest news, the approvals to purchase houses have hit an all-time high in the last few months, driven mainly by the concern over taxes getting adjusted in the upcoming budget. 

What’s the increase?

The latest figures from the Bank of England reveal that mortgage home buying approvals increased to 50,000+ last December from 48,000 in November. This was the highest number of approvals since July 2023, which indicates an increase in buyers looking to purchase properties before stamp duty increases. 

Despite the high interest rates, the number is rising because buyers are keen to ensure they lock in the best mortgage deals after the news surfaced in the market about tax changes for homebuyers in the coming months. 

Is it temporary?

Unless the government has other plans, the threshold will be introduced temporarily and is rumored to expire in March 2025. The current speculation is that the Chancellor may soon reveal the changes in the Spring Budget, declaring an end or revision in tax for buyers. 

First-time buyers in England and Northern Ireland pay no stamp duty tax on properties valued at up to £425,000 and a reduced rate for homes worth up to £625,000.

Due to rising market concerns, buyers are pushing to speed up their purchases. They fear that they might have to pay more if they wait. Since last month, first-time buyers have increased their activities to get their hands on the best properties. 

What’s the impact on the housing market?

With this surge, hopes for the 2025 UK housing market are firm. While property prices are generally stable, the increase in demand may lead to short-term price growth in many areas, primarily where buyers compete to get good property deals before the tax is implemented. 

It should also be noted that experts have already warned that removing or reducing the stamp duty may cause a slowdown in the latter part of 2025. It would cool the market and dry up sales, as investors are pushing hard to lock mortgages and finalize their properties before the announcement. 

With mortgage approvals on the rise, buyers are rushing to finalise the deals whilst all eyes are on the Chancellor to reveal the Spring Budget. The government’s decision on stamp duty could significantly impact market activity in the months ahead. For now, buyers considering purchasing a property may benefit from acting sooner rather than later, as the current stamp duty thresholds remain in place.