"Our data consistently shows that UK consumers are remarkably resilient, finding ways to manage their finances amid ongoing pressures."
- Paul Heywood, chief data & analytics officer at Equifax UK
According to data from Equifax UK’s Affordability Barometer, there was a brief but significant elevation in higher-value lending in March 2025, driven by the UK stamp duty deadline.
Equifax data shows that new mortgage lending activity normalised across May and June, with origination volumes returning to levels consistent with H2 2024.
On average, monthly repayments on new agreements briefly peaked, hitting 74% above the January 2022 baseline which marked the beginning of the UK rate increase cycle. However, this figure represents an anomaly with the underlying 2025 trend consistently showing stable repayment levels at 55% above that same baseline.
While the mortgage market saw 49% robust growth from February to March 2025, Equifax found the most significant activity concentrated on lending bands more likely to be directly impacted by stamp duty changes.
Origination of loans between £200,001 and £400,000 - a segment likely to include homebuyers looking to beat the standard tax-free allowance reduction and first-time buyers (FTBs) aiming to stay beneath the £425,000 tax-free threshold - grew by 69%.
This impact was more obvious in the £400,001 to £550,000 range, where volume surged by 93% with FTBs facing a potential tax increase of up to £11,250.
Paul Heywood, chief data & analytics officer at Equifax UK, explained that H1 2025 was a period of adjustment for the UK mortgage market; “We’ve seen a clear reaction to policy changes, with the stamp duty deadline creating a temporary surge in activity and influencing the average value of new lending and repayments.”
“Despite the data primarily reflecting a shift in the mortgage levels being taken out, rather than a fundamental rise in the cost of borrowing, baseline affordability challenges persist for many consumers and are perhaps compounded for those who sought to accelerate their purchase plans to benefit from the temporary stamp duty relief.
“Our data consistently shows that UK consumers are remarkably resilient, finding ways to manage their finances amid ongoing pressures. However, we must ensure that the right support and tools continue to be available to help everyone navigate their financial journeys effectively and make informed decisions for their long-term financial health,” he said.
