Big regional disparities on stamp duty have been found by a leading building society.
A study commissioned by the Coventry Building Society revealed that stamp duty on an average priced property in London is 356 times higher than a similar property in the East Midlands.
The research also found that as the average property price is only 2.11 times higher in London compared to the East Midlands, the tax bill is “vastly disproportionate”.
Going back nearly a decade to 2014, the mutual found that the stamp duty on an average priced property in London was 17.6 times higher than that in the East Midlands.
It said this figure indicates that the tax disparity between the capital and the region has sky rocketed under the new stamp duty thresholds.
In September last year, the government doubled the threshold at which stamp duty is applied for properties in England and Northern Ireland from £125,000 to £250,000.
For properties worth £250,001 to £925,000, stamp duty is charged at 5%. Properties valued between £925,001 and £1.5 million have a 10% duty attached to them, and for anything above this threshold, the charge stands at 15%.
Regional house price breakdown
According to the building society’s figures, the North East currently has the lowest average house price at £165,366.
While the average price of a house in the East Midlands is £250,818, in London the median price of a house reached £535,597.
The stamp duty for the averaged priced house in the North East currently would be zero, for the East Midlands just £40 would be charged, whereas in London, stamp duty would leap up to £14,279 for the typical house price.
In March 2025, the threshold for stamp duty will fall back to £125,000. By the current average house price figures, stamp duty will rise from £40 to £2,540 in the East Midlands, while in London it will climb up from £14,279 to £16,749.
Coventry: ‘Stamp duty changes on the horizon’
Jonathan Stinton, head of intermediary relationships at the Coventry Building Society, said: “The rumours have started swirling that stamp duty changes are on the horizon, with announcements speculated to be made during the Autumn Statement.
“The numbers show these changes can’t come quickly enough, at the minute some people are paying up to 356 times more tax on something which is only twice as valuable – that’s clearly flawed. A lot more work needs to be done to make sure buyers in the capital aren’t being hit with a bill which is disproportionately high.
“Homebuyers across the country aren’t being treated equally, and that needs to be addressed.”
