2025 Housing Market: 5 Trends You Need to Know Before You Make Your Move
As we approach 2025, many of us are thinking about what the year ahead will bring for the housing market. Whether you're considering buying, selling, or remortgaging, it’s important to understand the key trends that will shape the market. Here's what you need to know:
2025 Will Still Be a Buyer’s Market
If you’re thinking about buying a property in 2025, you’ll be in a great position. The market is expected to remain a buyer’s market, meaning there will be more homes available and longer times to sell. While asking prices are predicted to rise by 4% over the course of the year, buyers will still have the advantage when it comes to negotiating. This is especially important for those who are looking for competitive prices and a wider selection of homes. If you're on the hunt for your dream home, 2025 could be the year to make a move.
Mortgage Rates Are Set to Fall
The good news for buyers and homeowners looking to remortgage is that mortgage rates are expected to drop in 2025. Current predictions suggest that two-year and five-year fixed rates could fall to around 4.0%, down from the current averages of 4.83% for five-year fixed and 5.08% for two-year fixed mortgages. This drop in rates is linked to expected cuts in the Bank of England Base Rate and will improve affordability for many homebuyers. However, don’t expect mortgage rates to return to the ultra-low levels we saw in the past- rates will still be higher than pre-pandemic levels. For many buyers, this means an opportunity to lock in a better deal, particularly with shorter-term two-year fixed mortgages that could become more appealing as they align with five-year rates.
Stamp Duty Changes Will Impact Buyer Activity
One of the most significant changes in 2025 will be the rise in stamp duty rates set for April 1, 2025. This is expected to spark a rush of buyers trying to complete their transactions before the deadline. If you're a first-time buyer, you'll want to act quickly—there’s already been a 13% increase in activity from first-time buyers compared to the same period last year. The impact of these changes will vary by region. In places like the North East, over 70% of homes will qualify for stamp duty-free purchases for first-time buyers, whereas in London, only 8% of properties fall under the threshold. The first quarter of 2025 will likely see a boost in activity as buyers attempt to beat the stamp duty deadline, so if you’ve been thinking about buying, now might be the perfect time to make your move.
Remortgaging Will Be a Major Focus
With many homeowners nearing the end of their mortgage deals, remortgaging will be a key focus in 2025. If you locked in a five-year fixed rate mortgage during the pandemic when rates were lower, you may see higher costs when you remortgage. On the other hand, homeowners who secured two-year fixed deals during the mini-budget period may benefit from lower repayments as rates decline. As mortgage rates adjust, remortgaging will become a hot topic in 2025. If you're coming to the end of your fixed-rate mortgage deal, now is the time to start exploring your options. Keep an eye on remortgage trends and consider using tools like a remortgage rate tracker to monitor lender behaviour and find the best deals available.
London’s Property Market Is Set for a Resurgence
For those looking to buy or invest in London, 2025 could be a big year. While the city has lagged other parts of the UK in recent years, it is expected to experience a resurgence in 2025. With factors like the return of office-based working and renewed interest from international buyers, demand in the city is set to rise.
Over the past five years, asking prices in London have increased by just 12%, compared to 21% nationally. However, experts predict that London price growth will be on par with or slightly ahead of the national average in 2025. If you’ve been eyeing London as a potential place to buy, the city’s market could be primed for growth next year, making 2025 a great time to invest.
Are You Ready for 2025?
The housing market in 2025 will be full of opportunity, with shifting trends and new possibilities for both buyers and sellers. Whether you’re planning to buy your first home, move up the property ladder, or refinance, understanding these key trends will help you make the most of the year ahead.
Want to learn more? Get in touch with us today to discuss how the 2025 market could impact your property journey. Whether you're looking for advice on buying, selling, or remortgaging, we're here to help you make informed decisions and take full advantage of the opportunities ahead.
Stay ahead of the market with FSS Property- contact us now to start your property journey with confidence.