Over the next year, we will start to see the effects of the change in government, and how this might impact specific populations of people in the UK. One of the upcoming changes that we wanted to investigate further is the change to Stamp Duty Land Tax, set to take place from April 2025.
Due to the average price of a house being more expensive in London and The South, first-time buyers in these areas may be hit harder with these changes. This can be especially disheartening for those who are already struggling to get onto the property ladder in these areas.
Research by proddowmackay.law in conjunction with Barrett and Co Solicitors, highlights the disparity for their clients due to their location. The data shows that typically, first-time buyers in: London, Berkshire, East Sussex, Essex, Hertfordshire, Kent, Middlesex, and Surrey will be impacted by these changes.
What are the Upcoming Changes?
In September 2022 in England, Stamp Duty Land Tax thresholds for first-time buyers were raised to £425,000 at a zero rate, and then a rate of 5% on the next £200,000. The latest budget announcement stated that in April 2025, this threshold is set to be reversed, with first-time buyers being forced to pay Stamp Duty Land Tax from £300,000 at a 5% rate.
Based on the data we analysed, in some areas first-time buyers will only see a small increase of Stamp Duty Land Tax. The more affected areas could see a Stamp Duty Land Tax bill of nearly £4,000.
How Will These Changes Affect First-Time Buyers?
As you all know, buying a house is one of the most expensive purchases of someone’s life. This is especially true if you are yet to get on the property ladder. Adding an extra expense on top of that could move the goalpost yet again.
Currently the average age of first-time buyers across England is 34, however, with this additional cost the average age could go up.
Joanne McArthur, Head of Regional Legal Services – South, who commissioned this research said: “These numbers really highlight the difficulties our clients have when stepping onto the property ladder. Our clients talk to us with great pride having saved the deposit for their first home, and this comes as another blow to them.”
She went on to say: “It’s sad seeing our clients so greatly impacted by the postcode lottery of Stamp Duty Land Tax.”
Stamp Duty Land Tax thresholds are set to change on 1st April 2025, with large numbers of first-time buyers and home movers set to be affected.
