It is essential to make well-informed decisions when it comes to buying your new home, whether it be a first-time purchase, a second home or simply upsizing or downsizing to suit your family’s needs. Many factors can affect these decisions, with mortgage rates and stamp duty included.
In 2025, mortgage rates are expected to fall, with five-year fixed-rate mortgages dropping to approximately 4% and two-year fixed-rate mortgages predicted to follow suit and decrease also.
From 1st April 2025 stamp duty rates will increase and for those already involved in a transaction there will be the added pressure to complete a purchase before this date. There is a significant risk of further negotiations on agreed prices should property purchases not complete by the 31st March as buyers look to balance the higher costs incurred. Should this affect a property sale or purchase that you are involved in speak with your agent and solicitor to ensure all parties are working towards the same deadline for completion and check that this is possible with any third parties that may be involved like mortgage lenders.
Around 1.8 million fixed rate mortgages are set to expire in 2025 with many homeowners being faced with higher costs than when they fixed their low five-year rate in 2020. Alternatively, there will also be those who had a two-year fixed rate mortgage with higher rates following Liz Truss’s Mini-Budget that will also be expiring and will find that they will be able to lower costs with a better rate than agreed at the end of 2022 into 2023.
As always, there are opportunities and obstacles when buying, selling, or remortgaging your home with the housing market changing and being affected by a range of factors. Look to your agent and financial advisor for expert advice on your property in order for you to make an informed decision on the best path to take.
