A record number of first-time buyers were dragged into paying stamp duty this year, new figures show. Estate agents Connells says nearly a third (30%) of first-time buyers in England purchased homes above £300,000 this year, pushing them above the stamp duty threshold.
It marks the highest proportion of first-time buyers on record that have had to pay stamp duty, and is up from just a small minority a decade ago. Both higher house prices and the end of the temporary stamp duty holiday are being blamed for the increase.
The first-time buyer stamp duty threshold in England and Wales was reduced from £425,000 back down to £300,000 last April.
London hardest hit
London house buyers were the hardest hit. Nearly four in five first-time buyers in the capital (78%) bought above £300,000 and therefore paid stamp duty, the highest share of any region and up five percentage points compared to a year ago.
The East of England and the South East also saw big increases, with 40% and 38% of first-time buyers paying stamp duty, respectively. Buyers in these regions also face some of the highest average bills outside the capital, at £4,440 in the East and £5,130 in the South East.
Elsewhere, 14% of first-time buyers in the North West and 13% in the West Midlands paid stamp duty.
Bigger discounts negotiated
But Connells says first-time buyers are also negotiating bigger discounts. Since the end of the stamp duty holiday in March 2025, the average asking price of homes purchased by first-time buyers has jumped by 5.0%. However, the average price actually paid by first-time buyers nearly flat - rising by just 0.7%.
First-time buyers are now securing an average of 1.0% more off asking prices compared to the month before the end of the stamp duty holiday last year.
What is stamp duty?
Stamp duty is a tax that sometimes has to be paid when you buy a property. It all depends on how much the property is worth, if you’re a first-time buyer, and if the property you're buying will be your main home, or if you're purchasing is a second home. There are different stamp duty rates in England, Scotland, Wales or Northern Ireland.
Aneisha Beveridge, Research Director at Connells Group, said: “For a growing number of first-time buyers, getting onto the housing ladder means saving for more than just a deposit. Stamp duty is becoming a bigger part of the upfront cost of buying, particularly as more people purchase their first home later in life and opt for larger, more expensive properties that can meet their needs for longer. At a time when affordability is already stretched, stamp duty costs create yet another hurdle for households trying to make the numbers stack up.”
