News 21.6.1 (1)

Homebuyers Paid £1bn Stamp Duty in May; Match Last Year’s Levels

In May, homebuyers shelled out a staggering £1 billion in stamp duty, matching the cumulative £4.4 billion paid during the same period last year. The tax, levied on property purchases over £250,000, is set to become an even greater burden next year as the threshold drops to £125,000 in March 2025. This change will see the average stamp duty on a home in England soar from £2,411 to £4,911.

Currently, first-time buyers enjoy a higher threshold, paying stamp duty only on homes costing more than £425,000. However, this threshold is also set to decrease to £300,000 in March 2025, further impacting new entrants into the housing market.

Jonathan Stinton, head of intermediary relationships at Coventry Building Society, highlighted the impending challenges. “Stamp duty might not be in all the party manifestos, but it’s certainly going to be near the top of the to-do list for whoever is Chancellor on 5th July,” he remarked.

Stinton emphasized the urgency of addressing the looming changes: “In a matter of months, the temporary thresholds will expire, and buying a home will become a lot more expensive. As it stands, someone buying an average-priced home in England next April will have to fork out an extra £2,500 to the taxman.”

He further advised that the optimal time for action would be the next Budget, likely in September. “Leaving it any longer will ratchet up the uncertainty and could distort the housing market as buyers and sellers seek to beat the deadline in March,” Stinton warned.

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