Mortgage completions surge 68% in Q1: UK Finance

Mortgage completions rose sharply in the first quarter of 2025 as both first-time buyers and homemovers sought to complete transactions to benefit from lower stamp duty rates before changes took effect on 1st April, new UK Finance figures show.

For the quarter as a whole, first-time buyer completions increased 62% year-on-year and homemover completions increased by 74%.

There were notable peaks in March, with the number of first-time buyer and homemover completions increasing by 113% and 140% respectively compared with March 2024.

Early data for April suggests a natural cooling of activity following the rush to secure lower stamp duty rates.

Affordability remains stretched and borrowers continue to take longer mortgage terms to help manage affordability pressures, especially first-time buyers. The average first-time buyer mortgage term is now 31 years as of March, compared with 28 years in March 2015. The increase in the average term has been driven primarily by a significant increase in borrowing over a 40-year period, typically the maximum allowed under lenders’ policies.

The amount spent by first-time buyers on mortgage payments relative to their income is also high. Even as interest rates have come down, this measure of affordability has not eased significantly, with rising house prices largely offsetting any lowering of payments through falling rates.

Remortgaging and refinancing

UK Finance says it is starting to see a "modest shift away from product transfers" and towards more external remortgaging.

Refinancing activity declined by 13% in Q1, largely due to fewer fixed rate deals maturing early in the year. During the quarter eight out of ten mortgages that were refinanced were done via a product transfer, which is higher than long-term averages, but lower than 83% in Q1 2024.

In total, around 1.6 million fixed rates mortgages are due to expire in 2025 as a whole.

Toby Leek, president of NAEA Propertymark, commented: “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 after-effect. 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.”