First Time Buyer
Stamp duty holiday savings hit £108m in two months
Research into data from 8 July and 31 August showed there were 20,238 transactions since the stamp duty holiday was launched, with a sold value of £6.7bn.
According to estate agency Benham and Reeves, 85% of these transactions fell below the £500,000 threshold and therefore paid no stamp duty.
Without the tax relief, £189m would have been paid in stamp duty but the total paid during this period was £80.8m.
Benham and Reeves predicts that based on the current amount saved so far, by March the total could reach £524.9m.
Southampton, Plymouth, Sheffield, Newcastle and Nottingham were among the biggest cities where the majority of homebuyers benefited from the stamp duty holiday as 98% of transactions in these areas fell below the threshold.
Other major and more affordable cities saw between 84% and 97% of transactions pay no stamp duty.
At the lower end of the scale, Oxford and Cambridge saw 59% and 52% of transactions eligible for the tax relief.
Outside of the capital, buyers in Birmingham completed the most transactions during the period at 300 and purchasers in Bournemouth saw the largest savings at £1.5m.
Despite London seeing the lowest proportion of eligible transactions at 48%, purchasers in the capital took the most advantage of the relief with 1,017 exempt transactions taking place and a total saving of £25.2m.
Director of Benham and Reeves, Marc von Grundherr, said: “Given the fact that the holiday has only been in place for a few short months, the money saved by homebuyers as a result is quite astounding.
“Of course, it has caused demand to go through the roof and so you could argue that in ‘regular’ market conditions the saving wouldn’t be quite as considerable.”
‘Archaic money grab’
Von Grundherr added: “It has helped the housing market bounce back from pandemic uncertainty at an alarming rate, helping to avoid a property price crash, while benefiting thousands of homebuyers in the process.
“It will be interesting to see the final scores on the doors once the holiday ends but at this rate, the money saved is going to be huge.
“You could argue that the tax should be abolished completely as it’s nothing more than an archaic money grab from the government, to the detriment of those who are already stretching to afford the most expensive purchase in life.
“Based on these figures, you wouldn’t be the only one and it does highlight just how much is paid to the government via stamp duty tax.”