Nationwide expects ‘volatile’ start to 2025 for the property market

A Stamp Duty rush will lead to a jump in transactions in the first three months of 2025 followed by a period of weakness, Nationwide claims.

Nationwide has released its house price outlook for 2025, with all eyes on the change in Stamp Duty thresholds from April.

Robert Gardner, chief economist for Nationwide, said:

“Upcoming changes to stamp duty are likely to generate volatility, as buyers bring forward their purchases to avoid the additional tax. This will lead to a jump in transactions in the first three months of 2025 (especially in March) and a corresponding period of weakness in the following three to six months, as occurred in the wake of previous stamp duty changes. This will make it more difficult to discern the underlying strength of the market.

“But, providing the economy continues to recover steadily, as we expect, the underlying pace of housing market activity is likely to continue to strengthen gradually as affordability constraints ease through a combination of modestly lower interest rates and earnings outpacing house price growth, where the latter is likely to remain broadly in the 2-4% range in 2025.”

Commenting on the research, Toby Leek, president of NAEA Propertymark, said: “Propertymark members have reported an increasing interest in property with sales higher than usual, defying the usual winter lull usually seen this time of year.

“Buyers and sellers in England and Northern Ireland are looking to complete their home move before the Stamp Duty changes commence from April 2025, and it’s expected that coupled with slow increases in affordability and wages, this spike of momentum in mortgage approvals and housing market activity will continue.

“After this spike, buyers and sellers with time on their side may then reap the rewards of a slower paced market to ensure each step of their house move is fully considered.”

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