Coventry Building Society is calling for long-term reform of stamp duty as homebuyers paid £957m in April, according to the latest HMRC figures.
Since January, homebuyers have paid £3.4bn in stamp duty, a £191m reduction compared to the same period last year. This reduction is attributed to a decrease in property transactions, with over 17,000 fewer transactions in England during the first quarter of the year.
Currently, homebuyers pay stamp duty on properties costing more than £250,000. In March 2025, this threshold will drop to £125,000, increasing the tax on an average-priced home in England from £2,386 to £4,886. For first-time buyers, the threshold will drop from £425,000 to £300,000 in March 2025.
Jonathan Stinton, head of intermediary relationships at Coventry Building Society, said: “Today’s drop in inflation could prompt the Bank of England to reduce rates sooner rather than later. The hope of base rate reductions could prompt more potential buyers to think about moving, but the upfront tax bill could still be a huge barrier they struggle to get around.
“Paying thousands of pounds in stamp duty could easily disincentivise any would-be buyers and keep people from moving up and down the ladder as freely as they would like. It could cause a prolonged sag in the market, which then prompts drastic measures to get it moving again, resulting in another boom/bust cycle – like we saw with the 2020 stamp duty holiday.
“Previous stamp duty changes haven’t stood the test of time – they’ve been quick-fixes which have only helped buyers in the short-term. Now is the time for carefully considered reform, taking into consideration some of the issues facing buyers and sellers, with the aim of building long term stability rather than a sudden sharp boost in numbers.”
