House sales will “jump” early next year as people try to buy before stamp duty rises, one of the UK’s biggest lenders has predicted.
From March 2025, changes introduced in Wednesday's Budget mean many will pay tax who previously would not have done so.
Nationwide said this would affect a fifth of first-time buyers.
However, the impact of these changes is not expected to be as significant as previous ones, as high interest rates still deter buyers.
“Affordability is also still relatively limited at present due to the higher interest rate environment, which is dampening property market activity more generally,” the chief economist said Robert Gardner.
He added that the changes, which only apply to England and Northern Ireland, were expected, meaning they are likely to have less effect than changes made in 2020 and 2016.
He predicted that the recovery in activity would be followed by a slowdown over the next six months, based on what happened after previous stamp duty changes.
Nationwide also said the impact would be less in areas where house prices are cheaper, such as Northern Ireland and the north of England, and greater where housing is more expensive, such as London and the South East of England.
Currently, buyers of homes worth less than £250,000 do not pay stamp duty. This amount has been doubled from £125,000 as part of Liz Truss' September 2022 mini-budget.
The threshold is £425,000 for those buying their first property. This amount was increased by £300,000 as part of the mini-budget.
These higher thresholds will end in March 2025, at which point they will return to previous levels.
Verona Frankish, managing director of online estate agent Yopa, said the changes “will certainly light a fire in buyers who are currently progressing through the transaction process or are considering a purchase before Christmas”.
However, she added that any drop in mortgage rates next year would have a much bigger impact.
The average house price in the UK reached £265,738 in October, according to the latest Nationwide data.
House prices remain below their 2022 peak, but have risen slowly over the past year as interest rates have fallen and buyers have returned to the market.
