With March proving to be a remarkable month for the UK housing market, we provide unique insights into the story behind the headlines, and what the rest of the year looks like for estate agents.

March delivered a remarkable month for the UK housing market, with residential property transactions surging to 164,650 - a level not seen often in recent history. In fact, this made March the fifth-highest month for residential transactions in the last 20 years. To put it into perspective, that figure is a 69% increase compared to the long-term average monthly transaction level of 97,700.

So, what was behind this sudden surge in activity?

The primary driver was a flurry of activity among first-time buyers, many of whom were determined to beat the stamp duty deadline that came into force on 1st April. With changes to stamp duty rules on the horizon, buyers acted quickly to lock in deals and avoid additional costs. It’s a pattern we’ve seen many times before in the UK housing market, where tax policy has a direct and immediate influence on buyer behaviour.

Historical echoes: Stamp duty as a market mover

This is not the first time that stamp duty changes have dramatically influenced the volume of housing transactions. A look back over the past two decades shows multiple clear spikes in activity, each closely tied to shifts in stamp duty policy.

In 2016, for example, there was a major surge in transactions in the run-up to the introduction of the 3% stamp duty surcharge on second homes. Investors and second-home buyers rushed to complete deals before the surcharge came into effect, creating a temporary but sharp increase in demand.

Similarly, during the COVID-19 pandemic, the government introduced a stamp duty holiday to help stimulate the market during uncertain economic times. This exemption led to a wave of activity across the housing market, especially in the second half of 2020 and into 2021, as buyers sought to make the most of the savings on offer.

March 2025’s spike is the latest chapter in this long-running trend. It serves as a powerful reminder of how sensitive the housing market is to government incentives and fiscal policy changes. When tax savings are on the line, buyers often respond with speed and urgency.

What does this mean for the market now?

While March’s transaction numbers are undoubtedly impressive, it’s important to note that some of this activity has likely been brought forward. Buyers who may have otherwise completed purchases in April, May, or later in the year chose to accelerate their plans to avoid higher stamp duty costs.

As a result, it’s reasonable to expect a short-term lull in activity in the months immediately following the deadline. However, the outlook for the rest of the year is not necessarily bleak. In fact, recent interest rate cuts may help to offset the post-deadline slowdown by making mortgages more affordable and restoring some buyer confidence.

With inflation falling and borrowing costs gradually easing, more households may feel confident enough to re-enter the market later in the year, potentially smoothing out the dip caused by the March spike.

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