The stamp duty rules changed in April 2025, meaning buyers will now face increased tax on property purchases. This made the new year a particularly busy one for mortgage lenders, solicitors and estate agents, with buyers dashing to complete transactions before the hike occurred.
Buyers will now pay tax on properties worth £125,000, compared to the £250,000 threshold previously in place. According to Nationwide, the average UK property sale price is £266,000; those purchasing such a property will now pay £2,500 more in stamp duty. Furthermore, first-time buyers will now pay stamp duty on properties worth more than £300,000 (it was previously £425,000), with this lower threshold applicable where properties cost £500,000 (rather than £625,000).
Is Stamp Duty Always Payable?
Stamp duty is payable when property over a certain price is purchased in England and Northern Ireland. In Wales, land transaction tax is payable, while in Scotland property purchasers are required to pay land and buildings transaction tax. Buyers must pay stamp duty within 14 days of the completion date or they could face incurring interest on the amount owed or a fine.
The tax is applicable upon the purchase of a new or existing leasehold, when buying a freehold property, when a mortgage loan is taken out or you buy a share in a house, and when a property is purchased via a buying scheme.
What Is the Government Aiming to Achieve?
What’s behind the rise in stamp duty? In its policy paper published in October 2024, the government set out the objectives behind the move. The main driver is the disincentivising of the purchase of buy-to-let properties and second homes, which the government hopes will free up housing stock for first-time and main home buyers.
The changes are also designed to make sure that companies (and other non-natural entities) always pay the highest rate of stamp duty when purchasing properties for over £500,000.
How Can Buyers Ensure Property Purchases Go Through Smoothly?
Real estate professionals – such as Emile Salame – know that in light of the recent stamp duty changes many buyers are keener than ever before to ensure that their property purchase goes through smoothly. To this end, it’s a good idea for buyers to have their finances checked before putting in an offer: having a mortgage in principle shows sellers that the potential buyer is ready to move quickly. It’s also generally advisable to have searches completed early, book a survey as soon as possible and – as far as is feasible – to be ‘proceedable’.
For more information about stamp duty, take a look at the embedded PDF.
