Homebuyers 'increasingly' paying higher rate of stamp duty

05-Mar-2007

In news which may be of interest to prospective first time buyers, new research suggests that homebuyers are increasingly paying the higher rate of stamp duty.

According to research by HBOS, the number of home purchasers in England and Wales - which may include would-be first time buyers - paying the three per cent rate of stamp duty has increased by 281 per cent over the last five years.

In 2001, 73,403 homebuyers paid stamp duty of three per cent for properties between £250,000 and £500,000, while in 2006 the number increased to 279,408.

Under the current regulatory regime, for properties under £125,000 no stamp duty is payable, while properties between £125,000 and £250,000 attract stamp duty at a rate of one per cent.

To find out about the different ways of financing a first home, see our section ‘Affording Your First Home’.

"Homebuyers in these transactions were faced with a stamp duty bill of at least £7,500," said HBOS.

"In 2006, 19 per cent of home buyers paid at least three per cent stamp duty compared with six per cent in 2001," the company added.

HBOS was established in 2001, following the merger of Halifax and the Bank of Scotland.

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