Stamp duty up 82% for first time house buyers
Written by admin on Tuesday, March 11th, 2008 in UK Business, UK Housing Market.
A report from mortgage lender Halifax has released data the shows stamp duty for first time buyers has risen 82% over the last five years, in line with soaring house prices.
In 2007 the average bill was £1,751 compared with just £960 in 2002.More interestingly nearly all first time buyer in the South West, South East and East London were liable to pay stamp duty, while only 42% of first time buyers in Northern regions had to pay.
In London it is even worse news for first time buyer with the average stamp duty bill increasing by 364% over the last five years to £8,675.
The government has highlighted that as part of plans, half of all first time buyers will pay no stamp duty this year, and the lowest 1% tax band hits houses of value between £125,000 and £250, 000. Houses with a value between £250,000 and £500,000 will have a 3% charge, whilst properties above that bracket incur a 4% charge.
“Stamp duty has again become an issue for first-time buyers because the stamp duty thresholds have not kept pace with house price inflation.” – Martin Ellis Halifax chief economist
Mr Ellis went on to acknowledge that the government has raised the 1% threshold in recent years but said the government needed “to raise the stamp duty thresholds to compensate for house price inflation over the past decade”.
There is light at the end of the tunnel however for first time buyers, with the survey showing UK house prices did fall by 0.3% in February.