Stamp Duty receipts have surged by 25% so far this year, with homebuyers paying a total of £5.5bn according to new analysis of HMRC data by Coventry Building Society.
The rise, compared with £4.4bn paid over the same period last year, underscores the growing tax burden on those trying to move home in an already strained market.
In May alone, buyers handed over £918m in Stamp Duty – a sharp drop from the £1.3bn collected in April. However, this decline is likely due to a lull in transactions following the reduction of nil-rate thresholds on 1 April, which saw the level at which tax becomes payable slashed from £250,000 to £125,000.
The consequences of this change are already being felt. The tax bill on a home at the UK’s average price has risen from £774 to £3,274, adding significantly to the upfront costs of a move.
“The bill for an average priced home has more than quadrupled, and that’s on top of everything else buyers are trying to cover”
Jonathan Stinton, head of mortgage relations at Coventry Building Society, said the latest figures highlight the financial pressure buyers are under. “Homebuyers are handing over eye-watering sums in Stamp Duty,” he said.
“The bill for an average priced home has more than quadrupled, and that’s on top of everything else buyers are trying to cover.”
He warned that the growing cost could dissuade people from moving altogether. “When moving comes with thousands in tax, it can put people off making that next step – whether it’s upsizing, downsizing, or just finding a home that better suits their life,” he said.
“That kind of strain doesn’t just affect individual buyers, it can slow the market down for everyone.”
Stinton also questioned the long-term rationale behind the levy, pointing out its origins over three centuries ago.
“When Stamp Duty was first introduced – back in 1694 – it was only meant to last four years. More than 300 years later we’re still paying it in one form or another, despite the fact the housing market has changed.
“It’s hard to see how a tax designed for a different era is still the best fit for today’s buyers.”
