Barclays has called on Chancellor Rachel Reeves to reduce stamp duty in the upcoming Autumn Statement, particularly for older homeowners looking to downsize. The bank argues that current tax rules are deterring over a million Britons from moving to smaller properties, exacerbating the housing crisis.
Stamp duty is currently payable on homes worth over £250,000, or £425,000 for first-time buyers, with rates ranging from 5% to 12%. For a £1 million home, the tax can reach £41,250, while the average bill stands at £9,000. Barclays claims these costs are a major barrier for 'last-time buyers' who wish to downsize.
Research by Barclays shows that 85% of owner-occupied homes in the UK have at least one spare bedroom, classifying them as 'under-occupied'. The bank estimates that with the right incentives, 3.8 million households could move to smaller homes, freeing up properties for first-time buyers and reducing household bills.
Barclays also notes that stamp duty revenues are falling, from £11.7 billion last year to an expected £8.6 billion this year, as property transactions stall. Mark Arnold, Barclays' head of mortgages, said: 'A stronger, more holistic strategy is needed to tackle the immense issues faced by the housing market.'
