Editor's note: This brief was summarised by The Property AI Newsroom from a report by Property Industry Eye. Read the original article for full details.
Record Number of First-Time Buyers Now Paying Stamp Duty
A record proportion of first-time buyers in England are now paying stamp duty, as rising property values push more purchases above the £300,000 threshold where tax relief begins to reduce. Analysis by Connells Group shows that 30% of first-time buyers in England purchased a home costing more than £300,000 this year, double the proportion recorded a decade ago and the highest level on record.
The increase in first-time buyers paying stamp duty has become more pronounced since changes to stamp duty thresholds introduced in April 2025. Before these reforms, only 10% of first-time buyers were purchasing above the previous £425,000 nil-rate threshold.
London remains the most affected region, with 78% of first-time buyers now purchasing above £300,000 and therefore liable for stamp duty. The average stamp duty bill for first-time buyers in London now stands at £12,690. Outside London, 40% of first-time buyers in the East of England and 38% in the South East are also purchasing above the threshold. The trend is also visible in more affordable regions, with 14% of first-time buyers in the North West and 13% in the West Midlands now paying stamp duty.
Despite the additional tax burden, first-time buyers appear to be securing larger discounts from sellers. Since the end of the stamp duty holiday in March 2025, asking prices for homes purchased by first-time buyers have increased by 5%, while the average price paid has risen by just 0.7%. In May 2026, first-time buyers paid an average of 96.9% of the asking price, compared with 97.9% before the stamp duty changes, resulting in an average saving of £2,690 per purchase.
More than a third of first-time buyers making offers on homes initially listed above £500,000 were able to negotiate the agreed sale price down to £500,000 or below, allowing them to remain eligible for first-time buyer stamp duty relief.
These trends are relevant for letting agents and inventory clerks monitoring market activity, as changes in stamp duty liability and negotiation patterns may influence demand, pricing, and the types of properties entering the rental and sales markets.
Source: Property Industry Eye