Housing market braces for the New Year rush
The housing market is getting ready for a big Boxing Day bounce following a seasonal dip in house prices this month.
New seller asking prices dropped by 1.7 per cent in December to £360,197, according to Rightmove, but ended the year 1.4 per cent above December last year.
Activity remained substantially stronger than the same period a year ago, with the number of sales being agreed is up 22 per cent and new buyer demand is up 13 per cent.
Rightmove has predicted new seller asking prices will rise by four per cent next year, with forecast mortgage rate drops set to further improve affordability and stimulate market activity.
“We are now looking ahead to the traditional Rightmove Boxing Day bounce in home-mover activity, which has increasingly become a key date in the housing market calendar,” Tim Bannister, Rightmove’s director of property science, said.
“Each year, our real-time data can pinpoint the exact moment that the turkey is finished, family games run out of steam, mobile devices are picked up, and prospective movers flood onto Rightmove and get their 2025 move started.”
Buyer demand jumped by 273 per cent between the Christmas Day lull and Boxing Day last year, and a record number of Boxing Day sellers launched their properties onto the market.
Stamp duty deadline looms
First time buyers currently pay no stamp duty on property purchases up to £425,000, but this is set to fall to £300,000 next April.
Sellers of smaller properties in higher-priced areas are trying to trade up or sell before the deadline to avoid the higher stamp duty charges, according to Rightmove.
In the last four weeks, the number of sellers of typical first-time buyer homes with two bedrooms or fewer in London coming to market rose by 20 per cent, the most of any regional market sector.
The number of sellers in the second most expensive region, the South East, has risen 16 per cent.
But prices are holding up for first-time-buyer type properties in more affordable areas, which are set to be less affected by the stamp duty changes as most first-time-buyer homes are well under the resuming £300,000 tax threshold.
“The stamp duty changes are a cloud over the market at the moment, with some groups much more impacted than others, and therefore keen to avoid the additional charges,” Bannister said.
“After the important first three months of the year in 2025, a lot depends on how quickly normal activity is resumed with higher stamp duty in England. A Bank Rate cut and some mortgage rate falls early on in the year would help to settle the market and provide a boost to sentiment and consumer confidence,” he added.