At the start of the year, several major companies including Amazon and JP Morgan have mandated a return to the office for three or even five days a week for all employees. This has led to housing market experts predicting that London house prices will rise in 2025, as workers search for homes closer to the office.
Many employees took advantage of flexible working policies that were introduced during the pandemic to move outside of London where property prices are cheaper. However, as bosses begin to demand that employees are more present in the office, this could spark a reversal of the trend.
Therefore, properties for sale in Hackney and other sought-after London neighbourhoods are likely to be snapped up very quickly, as buyers will be keen to avoid lengthy and costly daily commutes to work.
The unexpected drop in inflation in mid-January should boost housing market conditions in London further, as it means that an interest rate cut is more likely later in the year. This will make mortgages more affordable to first time buyers, and also encourage those to have been waiting to take their second step on the property ladder to make a move.
Tim Bannister, CEO of Rightmove, explained to Yahoo News: “There’s less competition amongst buyers than during the pandemic markets, which could provide them with some breathing room to choose the right home at the right price.”
“However, if the right property does come along, we wouldn’t advise waiting too long, as agents tell us that attractive homes, well-priced and in popular areas are still being snapped up quickly.
Beware the stamp duty changes on 1 April 2025
Furthermore, first-time buyers need to act quickly if they want to take advantage of the stamp duty cut, which is set to end at the beginning of April. Currently in England, first time buyers do not need to pay stamp duty on properties worth less than £425,000.
However, on April 1, this is set to return to the previous threshold of £300,000, which is well below the average price of a home for a first time buyer in London. This means that buyers will need to pay a tax of five per cent of the total value of the property if it is worth more than £300,000, and ten per cent if it falls into the £925,001-£1.5m price bracket.
There’s still time to complete a transaction before the cut-off date if you put the wheels in motion and already have a good idea of the property type you want to buy, the essential features it must have, and the location and neighbourhood you want to live in.
