Stamp duty receipts surge as tax hits average homes across England
Homebuyers in all regions of England are now subject to stamp duty on the purchase of an average-priced property, according to new analysis by Coventry Building Society based on the latest HMRC figures.
The change follows the reduction of the nil-rate threshold from £250,000 to £125,000 on April 1, which has increased the stamp duty bill on an average-priced home by £2,500, from £2,047 to £4,547. As a result, no part of the country remains exempt from the tax, including areas that were previously below the threshold.
Regions such as the North East, Yorkshire and the Humber, the North West, East Midlands, and West Midlands, where buyers of average-priced homes did not previously pay stamp duty, are now affected by the revised threshold.
In July, stamp duty payments totalled £1.4 billion, up 35% from £1.1 billion in June. This brings the total collected so far this year to £8 billion, representing a 21% increase compared with the £6.6 billion paid during the same period last year.
Reports earlier this week indicated that the Treasury is considering replacing stamp duty with a new property tax, which would apply to homes sold for more than £500,000.
“The fact that there’s now nowhere to hide from stamp duty shows just how out of step this tax has become,” said Jonathan Stinton (pictured right), head of intermediary relationships at Coventry Building Society. “From London to the North East, those buying a typical home in any region are now being hit with a tax that can add thousands to the cost of moving.
“There’s speculation of a new property tax, which would shift the burden from buyers to sellers - removing one of the biggest upfront hurdles people face - but it comes with a risk of market distortion. The prospect of reform could make buyers and sellers delay their moves while they wait for clarity. Once in force, it could reduce the supply of new homes coming onto the market, or warp house prices - with some owners trying to sell under £500,000 to stay below the threshold, and others increasing prices to offset the tax.
“The principle is right: our property taxes should fit today’s housing market, not the one we had decades ago. But it’s vital the detail is carefully designed so we don’t swap one barrier for another.”
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