There was bad news all round when it came to stamp duty yesterday.
While first-time buyers were hit by the government’s decision not to extend the relief on stamp duty for people buying their first home, buy-to-let investors were left disappointed at the prospect of having to pay an additional 2% stamp duty surcharge – effective from today.
The Conservatives raised the threshold for when first-time buyers pay stamp duty from £300,000 to £425,000 in 2022, but the new Labour government yesterday opted against extending this tax incentive.
Meanwhile, second home buyers, including buy-to-let investors, in England and Northern Ireland have seen the rate they pay in stamp duty surcharge increase from the old rate of 3% to 5% from today.
But among the various Budget-related headlines yesterday, very few mentioned the fact that the threshold for other home buyers was doubled from £125,000 to £250,000.
“Does anyone realise that next April stamp duty is going up?”, asked Martyn Gerrard’s David Smith.
“The temporary reductions in the SDLT thresholds were due to come to an end in April 2025 and as Reeves has chosen not to continue with the discount, SDLT is going up next year,” he added.
Rob Houghton, CEO of reallymoving, commented: “For homebuyers, it’s very disappointing to see no reference to the upcoming increase in Stamp Duty from next April. Our research shows the proportion of first-time buyers paying stamp duty will more than double, from 17% currently to 39%, when the temporary higher thresholds are reversed.
“The last thing first-time buyers and upsizers need coming down the road is yet another significant upfront cost, when they’re already grappling with extortionate house prices and higher mortgage rates. Reverting back to the old Stamp Duty thresholds seems completely non-sensical at a time when it’s harder than ever to get on the housing ladder.”
Simon Tyler, sales and marketing director for Davidsons Homes in Northamptonshire, believes it is important that buyers move swiftly to take advantage of the existing discounted stamp duty rates.
He said: “March next year might feel like a long time away, but in fact that’s only five months away for buyers wanting to make the most of the stamp duty holiday. We are advising all who are interested in moving to choose a new home, get your existing home ready to sell if you have one, and get your finances sorted ready for an exciting new move.”
‘Thousands of purchases could be abandoned’ after chancellor’s surprise stamp duty hike
