Mortgage adviser, Alexander Hall, has revealed that first-time buyers (FTBs) across 31 per cent of local authorities in England are set to see the cost of purchasing a first home increase as of April next year, when the deadline expires on current Stamp Duty Land Tax (SDLT) relief thresholds.
The research shows that there are currently 68 local authorities across England – 23% of the market – where the average price paid by a first-time buyer currently sits between £300,000 and £425,000, meaning that whilst the average FTB currently pays no stamp duty, they will start doing so from April 2025.
Whilst some areas, such as Adur, Stratford-upon-Avon and Cherwell, will see SDLT increase from nothing to less than £100, this climbs to almost £6,000 in areas such as Redbridge, Cambridge and Newham.
What’s more, current SDLT relief only applies to purchases of first homes up to £625,000 and from April next year this ceiling will reduce to £500,000.
As a result, there are four local authorities in England – Hackney, Richmond, Wandsworth and Kingston – where first-time buyers currently benefit from a degree of stamp duty relief due to the average house price sitting between £500,000 and £625,000.
As of next April, the average buyer in these London boroughs will no longer qualify for any SDLT relief, meaning the cost of stamp duty is set to climb by £11,250.
It’s also important to note that there are currently six local authorities where the average first-time buyer house price exceeds the current stamp duty relief limit of £625,000 – Westminster, Islington, Kensington and Chelsea, Camden, the City of London and Hammersmith and Fulham.
Whilst this will remain the case come April of next year, FTBs in these areas will still see an increase of £2,500 in the cost of SDLT due to changes for existing homebuyers.
As a result, Alexander Hall claim that the average first-time buyer across 93 local authorities is set to see an increase in SDLT paid when purchasing, which equates to 31 per cent of the total market in England.
