Santander UK has reported a 130% surge in mortgage applications in the fourth quarter of 2024, compared to the same period the previous year. This spike comes as home-buyers rush to potentially save thousands on stamp duty before the April changes.
The upcoming adjustments will see the “nil rate” band for first-time buyers drop from £425,000 to £300,000 and for other home-buyers from £250,000 to £125,000. Stamp duty is applicable in England and Northern Ireland.
Santander suggests that the average property purchase takes about four months from receiving a mortgage offer to completion. Therefore, those who bought towards the end of last year are likely to benefit from the current lower stamp duty rates before the April 1 deadline.
Graham Sellar, Santander’s head of intermediary channel – mortgages, said: “We all know that buying a home – whether it’s our first or our forever home – comes with significant costs. Every penny counts when considering things like legals and removals costs, so it’s great to see so many people make the most of the holiday and secure their new home ahead of April 1.”
In the South East of England, where the average house price stands at £385,600, first-time buyers could potentially save up to £4,280 in stamp duty if they purchase before April 1, according to Santander. In London, an average first-time buyer could face paying over £11,000 more from April, the bank has calculated.
Based on an average house price of £535,700, Santander estimates that a first-time buyer currently faces a stamp duty bill of £5,535, compared with £16,785 from April. Recent research conducted by Opinium for the bank among 2,000 first-time buyers suggests they are increasingly compromising on location to achieve their dream of home ownership.
Two-thirds (67%) of those who bought their first home in the past two years had never visited their new neighbourhood prior to purchasing, compared with just over half (51%) of those who bought more than five years ago.
