UK Finance’s Household Finance Review for Q1 2025 showed mortgage lending jumped as buyers moved to complete before Stamp Duty changes in April.
First-time buyer (FTB) completions rose 62% year-on-year, up from 66,250 in Q1 2024 to 107,000 in Q1 2025.
Homemover completions increased by 74%, up from 54,640 to 94,450.
March saw the biggest spike, with FTB completions up 113% on March 2024, from 24,070 to 51,180.
Meanwhile, homemover completions increased by 140%, from 19,720 to 47,360.
Affordability stayed tight, with more borrowers choosing longer terms, as FTBs now average a 31-year mortgage, up from 28 years in 2015.
Remortgaging shifted slightly, with more borrowers moving away from product transfers to external remortgaging.
Refinancing dropped 13% in Q1 due to fewer fixed-rate deals maturing.
Eight out of 10 refinanced mortgages were done via product transfers, a little lower than the 83% seen in Q1 2024.
About 1.6 million fixed-rate mortgages are due to expire in 2025.
Household savings rose by 3% in Q1 compared to March 2024.
More households put money into notice accounts and cash ISAs, which were up 10% and 11% respectively.
Eric Leenders, managing director of personal finance at UK Finance, said: “We saw a significant rise in mortgage activity in the first quarter as households moved quickly to take advantage of lower Stamp Duty rates.
“Savings also continue to build, with consumers increasingly favouring notice accounts and ISAs.
“As discussions around cash ISA reforms continue, it remains clear that many savers continue to favour them as a reliable means to build and protect their savings.
“While these are signs of growing financial resilience, the challenges many households face, particularly around affordability, remain.”
Leenders added: “Anyone worried about their mortgage or financial situation should speak to their lender early to explore the support available.”
Toby Leek, president of NAEA Propertymark, said: “The increase in Stamp Duty thresholds sparked a flurry of mortgage lending in the first quarter of 2025 due to people rushing to avoid paying higher rates of Stamp Duty across England and Northern Ireland and before thresholds changed at the start of April.
“While this has a positive effect on the mortgage market within the first quarter of the year, it was always inevitable there would be a post threshold slow down as an aftereffect.
“As we head into the summer months, it remains a case of all eyes on the Bank of England regarding the directions of travel on the base rate over the coming months and how this might translate into lenders bringing potentially more competitive mortgage products to the market.”
