Yorkshire Building Society said the number of first-time buyers (FTBs) applying for mortgages hit the highest level since 2022 at the start of 2025.
Research found 125,648 FTBs put in applications from January to March 2025.
The analysis also found that the number of FTB transactions were up by 12% compared to the same period last year, which is double the average year-on-year growth since Stamp Duty incentives began in 2017.
In Q1 this year, FTBs made up 55.75% of all buyers, up from 49.78% eight years ago.
Max Shepherd, group economist for Yorkshire Building Society, said: “FTB transaction levels to the end of March 2025 were bolstered by people rushing to beat the 1st April deadline.
“However, given the first-quarter figure has risen steadily since the incentive was introduced in 2017, the risk now is that the higher purchase tax, coupled with high house prices and other costs, add up to a cliff-edge moment for a group of borrowers who power the entire market.
“Some first-time buyers will have missed the 31 March deadline for saving money and been disappointed.”
Shepherd added: “Others are coming to terms with having to save up even more to get purchase-ready, amidst already-stretched affordability.
“This means we could see activity tail off from Q2, and it just remains to be seen by how much.
“The added danger is that if this change also deters home-movers, there will be fewer homes available for first-time buyers to buy, which would in turn increase property prices further out of their reach.
“Concerted industry action is needed to ensure this unwelcome change doesn’t send the positive momentum built over the past eight years into reverse.”
