Rightmove is urging the government to retain the existing stamp duty thresholds and provide additional help for first-time buyers.
The call comes as a new Rightmove first-time buyer study revealed that only 37% of homes for sale will be eligible for first-time buyer stamp duty relief in England when the existing thresholds revert from April 2025.
At present, a first-time buyer in England pays no stamp duty on properties up to £425,000. This means that the majority (58%) of homes for sale in England are free from stamp duty to first-time buyers, although there are significant variations throughout regions.
From April 2025, the stamp duty-free threshold is set to reduce back down to £300,000. According to the study, this means that, based on properties currently for sale, only 37% would be free from stamp duty to first-time buyers, representing a reduction of 21%.
The South West & East of England would be most impacted by the change, according to the study, while the North East would be the least impacted. In London, fewer than one in ten homes will be free from a stamp duty charge to first-time buyers in April 2025 if the old thresholds return, compared to a quarter now.
Since 2010, the average asking price of a home has risen by 62%, from £230,592 to £373,493. If purchasing a home at the current average asking price, a first-time buyer would pay £3,675 in stamp duty in 2025, compared with nothing now.
According to UK Finance, around a third of first-time buyers look to purchase properties over £300,000, weighted towards London and the more expensive regions.
As costs have increased, the average age of a first-time buyer has been increasing over time. The average age of a first-time buyer is now 33, according to UK Finance data, compared with 31 in 2010.
Rightmove has welcomed the new government proposals to help first-time buyers, including its initiative to give local first-time buyers the first chance to buy homes on developments. The company added that the government’s housebuilding targets and planning reforms should also positively impact those buying for the first time.
However, Rightmove believes its analysis suggests there are some limitations with a mortgage guarantee scheme, and it is only likely to be able to support a small number of first-time buyers. The company has suggested that making it permanent would at least give first-time buyers the confidence that it is an option for them.
As well as calling for the existing stamp-duty thresholds to be retained, Rightmove has suggested that a government review of mortgage affordability criteria and support for lender product innovations would help identify and potentially create more options for a greater number of first-time buyers.
Tim Bannister, Rightmove’s property expert, added: “The housing market is made up of many connected pieces – as owning your first home becomes more difficult, some people rent for longer, which places an additional strain on the rental sector.
“Stamp duty is a barrier to movement, and keeping the existing thresholds seems like a logical step to providing some first-time buyer support. Even greater stamp duty reforms in the future could have wider implications, such as helping those who are considering downsizing.”
