Stamp Duty Changing – What Does This Mean to First Time Buyers?
In the chancellor’s budget last month, it was announced that stamp duty tax for first time buyers would be increasing next year (April 1st 2025). If you are a first-time buyer looking to get on the property market how will this affect you?
Stamp Duty Land Tax (SDLT) is payable when purchasing property or land over a certain price in England. Changes to the stamp duty rates are due to come into play April 2025 and will affect first-time buyers.
As it stands first-time buyers do not pay stamp duty on the portion of a property valued up to £425,000, meaning a lot of first-time buyers don’t have to pay stamp duty at all. However, once the changes take place the threshold will drop to £300,000. This means more first-time buyers will face stamp duty costs.
Currently, the reduced stamp duty rate for first-time buyers are for properties up to the purchase price of £625,000. However from the 31st March 2025 this limit will drop back to £500,000, meaning first-time buyers will only benefit from the First-Time Buyers Relief if the purchase price up to £500,000.
In layman’s terms from April 1st 2025 the charges for First Time Buyers Stamp Duty will be as follows.
| Minimum property price | Maximum property price | Stamp Duty rate |
| £0 | £300,000 | 0% |
| £300,001 | £500,000 | 5% |
For properties over the value of £500,000 there will be no First-Time Buyer Relief on stamp duty and the buyer will pay the standard rate.
To avoid these increased costs, it’s wise to act quickly and aim to complete your purchase before 31st March next year. With conveyancing typically taking 12 to 16 weeks or in some cases even longer it is never too early to begin your house search!
