Stamp duty hits first-time buyers

Posted: 10 May 2006 09:55:08 GMT

            Property News - Stamp duty hits first-time buyers

The latest report from the Council of Mortgage Lenders (CML) has found that only half of first-time buyers avoid stamp duty.

Furthermore, around three quarters of home movers now have to pay stamp duty, which is despite the fact that the chancellor has raised the threshold from £60,000 to £125,000 in his last two Budgets.

The regulated mortgage survey from the CML shows that in March, 17,200 first-time buyers paid stamp duty, which is almost exactly half of all of those who reached the first rung of the property ladder in the month.

Of those moving from one property to another, 44,700 paid the tax and the CML has again called for "long overdue" reform.

Michael Coogan, director general of the CML, suggests that if stamp duty had been uprated in line with house price inflation since 1997, the threshold would now be £145,000 instead of £125,000, which would clearly allow more to avoid paying the tax.

The indications so far this year are that house prices will continue to rise, pushing more and more houses above the threshold.

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