Homebuyers have 18 months left to avoid stamp duty hike
Future homeowners have 18 months to dodge a stamp duty hike which could cost buyers around £2,500, analysis has found.
According to analysis from Coventry Building Society, currently homebuyers pay stamp duty if their home costs over £250,000, but this will drop to £125,000 in March 2025.
This will increase the tax bill for the average priced home from £2,822 to £5,322.
Changes to stamp duty thresholds were introduced in the mini Budget by former Chancellor Kwasi Kwarteng.
In the Autumn Statement, current Chancellor Jeremy Hunt reversed this decision, saying that the cut would end in March 2025.
Stamp duty for first-time buyers is also set to increase, with the current threshold standing at £425,000 and this set to fall to £300,000 in March 2025.
Figures for August show that homebuyers overall paid £1.1bn in stamp duty, the highest monthly figure so far this year and bringing the year-to-date total to £7.6bn.
Jonathan Stinton, head of intermediary relationships at Coventry Building Society, said: “Buyers need to know the reduction in thresholds isn’t forever – in eighteen months’ time people buying a home over £250,000 will suddenly have to pay an extra £2,500 in tax. That means buyers would need to start saving an extra £140 per month now just to cover the tax hike on their home.
“In an ideal world, the Chancellor is busy cooking up some long-term plans for stamp duty which will stop the tax bill on an average priced home virtually doubling overnight. Homebuyers didn’t get a mention in the Spring Budget, so let’s hope there’s something a lot more positive for them in the Autumn Statement.”