Homebuying rush might lead to price deflation

The majority of homebuyers plan to continue their property search over the Christmas period to meet the upcoming Stamp Duty Land Tax (SDLT) relief deadline, research reveals.

According to Lomond which carried out a survey of current homebuyers, 93% are aiming to complete their property purchase by March 31 2025.

That’s when the current SDLT relief thresholds expire.

To achieve this, 82% of respondents said they intend to keep house hunting until Christmas, with 74% planning to continue their search over the festive period.

However, one firm is predicting that with some buyers willing to pay over the asking price, they might over-stimulate the market.

And for those buyers who fail to buy by the deadline will probably drop the purchase which could lead to price deflation.

Motivators for house hunters

Lomond’s chief executive, Ed Phillips, said: “The Stamp Duty Land Tax adjustments approaching in March 2025 are proving to be significant motivators for house hunters in the market as we close out the year.

“So much so, that many are prepared to pursue their plans to purchase right up to, and over, the Christmas period.”

He adds: “As a result, we’re not only in for a very busy end to 2024, but 2025 looks set to bring much of the same.

“For those looking to sell, now is certainly the time to do so in order to take advantage of the influx of motivated buyers looking to make their move by spring.”

Online listings for potential properties

When questioned about how far they are willing to go, searching online listings for potential properties was the most common response.

That was followed by attending viewings, making offers and negotiating, advancing the sale through their solicitors and even relocating if necessary.

Lomond says the desire for a stamp duty saving is influencing buyer motivation with 71% indicating that if an extension had been granted during the recent Autumn Budget, they would not be acting with the same urgency.

Indeed, they said they would have postponed their home-buying plans until the New Year.

Transactions falling through and price deflation

A survey by over-50s property specialists Regency Living has also found that 44% of homebuyers want to complete before 1 April 2025.

Growing competition means that 11% of respondents are offering more than the asking price and 57% offering slightly more.

Those buyers who fail to meet the deadline will need to re-evaluate their position – which could spur an increase in transactions falling through.

It says that the willingness to pay more may stimulate the market but that could lead to market instability when buyers pull out.

The firm’s sales and marketing director, Tim Simmons, said: “Not only does heightened demand inflate house prices significantly, but those sales that fail to complete prior to the deadline are at risk of collapse, or at best, facing delays as buyers re-establish their position within the market.”

Share This Article