First time buyer news: First-time buyers faced with stamp duty worries

10-May-2006

Half of all first-time buyers and more than three quarters of home owners now pay stamp duty, according to latest data published today by the Council of Mortgage Lenders (CML).

Despite the decision by the chancellor to raise the threshold from £60,000 to £125,000 in his last two Budgets, aspiring homeowners are still finding it difficult to get their first foot on the property ladder.

These figures come from the CML's monthly regulated mortgage survey (RMS), which is the most comprehensive and reliable source of mortgage market data in the UK.

The survey reveals that in March, 17,200 first-time buyers paid stamp duty, while 44,700 people moving to a new home also paid the tax.

Aspiring first time buyers applying for shared ownership are advised to consult a good mortgage broker.

Statistics also show a fall in remortgaging. In March, remortgaging accounted for 36 per cent of lending, which is five per cent less than the previous month and ten per cent lower than March 2005.

"The RMS shows the proportion of mortgages taken out by first-time buyers is low. With half of them having to pay stamp duty it is clear that tax continues to add to their affordability problems," comments director general of the CML Michael Coogan.



Mr Coogan concluded that a "reform of stamp duty is long overdue" and if it is uprated in line with house prices it could help many more first-time buyers onto the property ladder.

Find out more about the housebuying process in the FirstRungNow Home Buyer's Guide.

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