Agreed UK property sales jump ahead of stamp duty increase

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Agreed UK property gross sales jumped by nearly a 3rd yr on yr on the finish of 2024 as patrons rushed to keep away from the rise in stamp obligation from subsequent April, based on information from Zoopla. 

Analysis by the property portal reported on Monday that there have been 283,000 gross sales agreed however not but accomplished as of December 14, the biggest gross sales pipeline in 4 years and up by 30 per cent on the tip of 2023.

Patrons’ inquiries have been up 21 per cent in December in contrast with the identical interval final yr. The corporate attributed the 2 developments to the incoming rise in stamp obligation, which was set out by chancellor Rachel Reeves in her October Budget.

Richard Donnell, government director at Zoopla, mentioned: “There’s a sizeable pipeline of gross sales that can full within the first half of 2025 with many hoping to keep away from greater stamp obligation prices from subsequent April.”

“Patrons and sellers returned to the housing market in 2024 having delayed strikes within the face of upper mortgage charges,” he added.

Reeves confirmed within the Finances {that a} short-term stamp obligation vacation would finish in March. Because of this, first-time patrons, for instance, will from April 2025 begin paying the levy for properties price £300,000 or extra, as an alternative of £425,000 at current.

Anticipation of modifications to the stamp obligation regime helped raise mortgage approvals to their highest degree since August 2022 in October, based on separate information printed by the Financial institution of England.

Matt Thompson, head of gross sales at Chestertons, mentioned the property company was “seeing one of many busiest Decembers in years when it comes to purchaser demand”.

“That is principally pushed by first-time patrons who’re eager to get on the property ladder earlier than subsequent yr’s modifications to stamp obligation, but in addition by second-steppers together with younger households, eager to upsize,” he added.

UK home costs rose 3.7 per cent year on year in November, the quickest annual development since November 2022, based on separate information printed by Nationwide earlier in December.

Zoopla reported an extra acceleration in annual home worth development in December, in contrast with the earlier month. But it surely additionally famous that patrons turned extra price-sensitive after the Autumn Finances and amid rising uncertainty over the outlook for mortgage charges.

Patrons paid on common 3.6 per cent under a property’s asking worth in December, Zoopla information confirmed, up from 3.2 per cent in the summertime.

Mortgage charges have ticked up since November over issues about cussed inflation, which has elevated monetary markets’ expectation that the Financial institution of England shall be cautious in reducing rates of interest subsequent yr.

The central financial institution held its benchmark rate at 4.75 per cent final week, after two reductions because the summer season. After the newest vote, BoE governor Andrew Bailey mentioned “heightened uncertainty within the economic system” meant policymakers couldn’t “decide to when or by how a lot we’ll minimize charges within the coming yr”.

Zoopla expects UK home costs to rise by 2.5 per cent in 2025. Thompson forecast development of three.4 per cent, saying that “improved affordability, pent-up demand and renewed confidence available in the market ought to present assist for regular development in property values”.