Yahoo Finance Stamp duty bills reveal huge North-South divide
In London, only 4% of homes for sale are exempt from the current stamp duty charges for all buyers, compared to 71% in the North East, according to Rightmove.
The property site is calling for a stamp duty reform ahead of the spring budget amid a stark stamp duty North-South divide
Less than a third of properties for sale in London are currently exempt from stamp duty for first-time buyers, compared with nine in 10 homes in the North East.
Homes in London have been traditionally more expensive than the rest of the country due to increasing demand.
Read more: How to protect your finances if you're going through a divorce
People must pay the tax on all properties over £250,000 or £425,000 for first time buyers.
The charge ranges between 5% and 12% of the purchase price, depending upon the value of the property bought.
The property portal has called for the government to implement policy changes in next week's budget to help people move home.
"At the very least, the government should be thinking about making the current changes to first-time buyer stamp duty charges permanent, with the higher thresholds introduced in 2022 due to expire next year," Tim Bannister, Rightmove's property expert said.
Rightmove wants a more localised approach to stamp duty charges in line with regional property prices – to support first-time buyers, but also to potentially encourage more movement up and down the housing ladder.
“Whilst longer-term supply measures are also needed, this could be one way to help first-time buyers trying to get onto the ladder in more expensive parts of England,” Bannister added.
Rightmove also warned any new scheme to help first-time buyers needs to go further than a rumoured 99% mortgage scheme is likely to.
Read more: Chocolate Easter egg prices set to rise as cost of cocoa surges
“Whilst we support new solutions to help more first-time buyers, the 99% LTV mortgage alone is only likely to support a relatively small group,” Matt Smith, Rightmove’s mortgage expert, said.
More needs to be done to strike the right balance between supporting a bigger group of future first-time buyers, whilst maintaining robust affordability assessments,” he added.
Figures from the Financial Conduct Authority and the Bank of England showed that only about 5% of mortgages are at the 95% or higher loan to value (LTV), as most prospective homeowners prefer to save for a larger deposit in order to secure a better mortgage rate.
Watch: How does the 95% mortgage scheme work?
Download the Yahoo Finance app, available for Apple and Android.
