The recent changes to stamp duty in England and Northern Ireland have sparked lively debates about their impact on the property market, especially for first-time buyers.

A Snapshot of the UK Property Landscape
Recent reports show the average UK home price ending 2024 at £297,166, marking a 3.3% increase from the year’s start. Some sources report a slightly lower figure closer to £270,000. Despite these differences, one thing is clear: the UK housing market remains resilient. However, house prices saw a small dip in December, likely influenced by affordability concerns and a more cautious approach from buyers.

What You Need to Know About the Stamp Duty Changes
From April 2025, the threshold for stamp duty will drop significantly, from £250,000 to £125,000 for most buyers. For first-time buyers, the exemption threshold will also lower, from £425,000 to £300,000.

For instance, a first-time buyer purchasing a home at £300,000 won’t pay any stamp duty. However, if the property costs £325,000, they’ll pay stamp duty on the £25,000 above the new limit.

This change could prompt buyers to act sooner than planned, especially early in the year, as they aim to avoid paying extra taxes.

Are First-Time Buyers Rushing In or Feeling the Pinch?
The reduction in thresholds could have a dual effect. On the one hand, it encourages those looking to buy later in 2025 to speed up their purchase plans to benefit from the current rates. On the other hand, this shorter window means many buyers are scrambling to get everything in place before the April deadline.

Affordability remains a challenge for first-time buyers, especially with house prices around £300,000 stretching budgets, and higher interest rates making mortgages more expensive. That said, improved job prospects and modest house price growth could help sustain demand.

How Do Regional Price Differences Affect Buyers?
The average UK house price doesn’t tell the whole story. Areas like London and the South East see significantly higher prices than other parts of the country, such as Northern England or Wales. The stamp duty changes will, therefore, have varied impacts depending on where buyers are looking.

For example, a first-time buyer in London purchasing a £450,000 property — above the new £300,000 exemption — will still face stamp duty, adding to the high costs already in play. Meanwhile, in more affordable regions, where many properties are priced below the threshold, the effect of the changes will be less noticeable.

Wrapping Up: Will First-Time Buyers Benefit or Be Pressured?
Mortgage brokers are already reporting a surge in activity as buyers rush to meet the April deadline. But for those just starting their property search, the clock is ticking. Getting a mortgage and completing the legal process can take several months.

This rush could lead to increased competition in the lower and mid-priced property markets, potentially driving prices up in the short term. While the stamp duty changes may offer some relief for first-time buyers, they also bring added pressure to act quickly.