Changes to the way Stamp Duty is charged have saved the average buyer £4,500 when purchasing a property in the last 12 months, according to a new report from Halifax.
Stamp Duty was reformed to a more progressive system in England and Wales in December 2014.
Halifax claims that the changes have saved money for most buyers, but have reduced demand at the top end of the market.
The bank says that the total tax charged in the UK increased to a record £7.5 billion in 2014-15.
Mortgages Director at Halifax, Craig McKinlay, states: “The changes made to Stamp Duty a year ago have been of significant benefit to many buyers.
“Only those purchasing the most expensive homes are worse off. There is some evidence that the top end of the market has been adversely affected by the changes, with sales over £1.5m falling by twice as much as the market as a whole.”1
Sales in the first half of the year dropped by 10% compared with the first six months of 2014, but sales fell by 20% for properties costing over £1.5m, the lender’s research found.
According to Halifax, 72% of Stamp Duty revenue raised was from property purchases in London, the East of England and the South East.
Just 1% of homes in London were bought for under £125,000 in 2014-15 – the threshold for which no Stamp Duty is charged. Contrastingly, 45% of properties in the North East were bought for figures below the threshold in the same period.
In the Autumn Statement, Chancellor George Osborne announced another change to Stamp Duty. From April, a further 3% will be charged on buy-to-let properties and second homes. Read more: /16883-2/
£5,520 will be added to tax on the average £184,000 buy-to-let property.
Use our Stamp Duty calculator to find out how you will be affected: /calculator/
1 http://www.bbc.co.uk/news/business-35004478