Reform Stamp Duty to Save the UK’s Housing Sector

August 5, 2024

HMRC collected £11.6bn in stamp duty last year, but a temporary cut in 2022 drove receipts up to £17.5bn, fuelling calls for reform

David Hannah, Group Chairman of Cornerstone Tax, contends that reforming stamp duty could significantly transform the UK’s housing market

The latest research from Telegraph Money reveals several effective strategies for reducing stamp duty bills and this includes utilising exemptions for first-time buyers. Currently, first-time buyers benefit from significant exemptions with the UK’s stamp duty threshold at £425,000, but this is set to decrease to £300,000 in April 2025, reducing the number of stamp duty-free homes available. Presently, 58% of homes in England are stamp duty-free for first-time buyers, but this percentage is expected to fall sharply with the forthcoming policy change. HMRC collected £11.6bn in stamp duty receipts last year, underscoring the tax’s substantial impact on homebuyers and driving calls for reform, especially when a temporary cut drove receipts up to £17.5bn. David Hannah, Chairman of Cornerstone Tax, advocates for well-targeted reform, arguing that it could stimulate the property market. Stamp duty often deters people from moving, whether for work or to upsize, and limits options for those looking to downsize.

Research by Cornerstone Tax shows that 44% of people feel priced out of their desired locations due to rising house prices, with Hannah stating that maintaining current stamp duty thresholds would invigorate the property market and the national economy. With homes valued at £450,000 or less exempt from stamp duty and those between £450,000 and £925,000 facing a 5% levy, the thresholds are overdue for a review. Adjusting these bands would not only benefit first-time buyers but also aid pensioners looking to move up the property ladder. This increased demand for mid-to-high-end properties could have a positive ripple effect, boosting sales and energising Britain’s stagnant housing market.

David Hannah, Group Chairman of Cornerstone Tax, comments:

“SDLT payment bands have been long overdue for an overhaul as they have never been index-linked to house price inflation. An increase in these thresholds would stimulate activity at the lower end of the property market and allow first-time buyers to reduce the amount they need to borrow, thus improving their affordability calculations. Furthermore, creating an exemption for pensioners would allow more Brits to downsize freeing up homes for those wishing to get onto the property market.

“As we all know, a rising tide lifts all boats, those looking to purchase properties on the mid-to-high end of the property market will now have a chance to sell their low-end properties as a result of the increase in demand from prospective buyers, contributing to further momentum within the housing market.”

EAN Content

Content shared by this account is either news shared free by third parties or sponsored (paid for) content from third parties. Please be advised that links to third party websites are not endorsed by Estate Agent Networking - Please do your own research before committing to any third party business promoted on our website. As an Amazon Associate, I earn from qualifying purchases.

You May Also Enjoy

Rightmove logo
Breaking News

Back-to-school buyer bounce outpaces typical September uplift

New real-time analysis from the UK’s largest property platform Rightmove reveals that buyer demand received a stronger than usual back-to-school boost during the first week of September Buyer demand increased by 5% during the opening week of the month, significantly higher than the average increase of 0.4% seen over the same period during the last…
Read More →
Letting Agent Talk

8,500 tenanted homes currently on the market

8,500 tenanted homes currently up for sale as TLP highlights importance of clean client money handovers   More than an estimated 8,500 homes are currently being marketed for sale with tenants in situ across England, according to the latest analysis by The Letting Partnership, presenting landlords with the opportunity to acquire an investment generating rental…
Read More →
Estate Agent Talk

Which property types take the longest time to buy?

From complex flats and shared ownership homes to new builds and unusual titles, Lyons Bowe reveals which properties can create the biggest conveyancing workload   The latest insight from Lyons Bowe has revealed which types of property are most likely to require the largest and most complex conveyancing workload, potentially adding more stages to the journey…
Read More →
Commercial Agent Talk

Building Site Accidents and Compensation: A Guide for Injured Workers

One mistake, one faulty piece of equipment and an unsafe working setup could cause a construction laborer much more than just aches and pains. One injury can result in medical costs, showing up on working days, reduced income and a path to long recovery. Under certain circumstances, the workers may be entitled to get compensation…
Read More →
Estate Agent Talk

First-Time Buyers: Why 4–5 Houses is the Sweet Spot

House hunting before the stress kicks in: Four to five houses is the sweet spot for first-time buyers Just 20% of us feel excited on a first property viewing, rising to 47% by viewings 4 to 5 There’s a U shape trajectory of excitement when it comes to the viewing process However, there is a…
Read More →
Breaking News

Two in five mortgage holders switched banks for a better mortgage deal

Of those who have a mortgage and switched banks, 41% did so to get a better mortgage rate deal and 30% did it to receive an incentive related to their mortgage Only 15% of people moving home switched their bank account during the move, while far more switched broadband (46%), energy (38%), and mobile phones…
Read More →