37% of first-time buyers facing stamp duty bill

28 March 2025

• New analysis[1] from Leeds Building Society shows that an additional 21% of first-time buyers in England will be subject to stamp duty land tax under new limits
• Following rule changes on Tuesday, more than 102,000 first-time buyers face paying stamp duty, almost 60,000 extra compared to the current rules
• The biggest increase in first-time buyer purchases expected to be subjected to the tax is in London where 85% of transactions will be affected, followed by the South East region
• Leeds Building Society’s Income Plus mortgages allow first-time buyers to borrow more while responsibly assessing their ability to repay

Leeds Building Society estimates that an additional 21% of first-time buyers in England face paying Stamp Duty when a freeze on thresholds is removed next week.

Currently, first-time buyers pay stamp duty on homes costing more than £425,000 but from Tuesday (April 1) that will reduce to £300,000.

The Society has assessed 2024 market-wide mortgage data and projects that an additional 59,400 annual home purchases are projected to become subject to the tax in England, alongside 43,000 purchases where taxes will be higher.

The changes mean that 85% of first-time buyers in London would be subject to the charges, along with 55% in the South East, 49% in the East of England, 30% in the South West, 16% in the West Midlands, 15% in the East Midlands, 13% in the North West, 9% in Yorkshire and the Humber, and 6% in the North East.

Leeds Building Society’s Income Plus mortgage range includes improvements in assessing how much borrowers can afford to repay, resulting in first-time buyers being able to borrow up to £66,000 more[2] on average.

Aspiring homeowners with a minimum household income of £40,000 could be able to borrow up to 5.5 times their earnings, compared to 4.5 times on its standard lending. This means the average first-time buyer could borrow a maximum of £356,000 through Income Plus compared to £290,000 under standard lending.

Matt Bartle, Director of Mortgages Leeds Building Society, said:

“We all know the value that having a place to call home can add to our lives. As a mutual, we were set up 150 years ago to help people own their own home and save for their future, creating a sense of belonging in communities across the country.

“This new analysis highlights the impact of changes to stamp duty will have on aspirational homeowners. We’ll continue to do everything we can to put homeownership within reach of more people, generation after generation.”

Discussing the housing market more broadly, Martin Temple, Economist at Leeds Building Society, said:

“We are seeing activity above the expected level at this time of year, as buyers look to complete on any purchases ahead of the changes to Stamp Duty Land Tax at the beginning of April.

“Although the outlook for the housing market remains broadly positive, with expected reductions in interest rates later this year, these changes represent another barrier for first-time buyers in the most unaffordable parts of the country.”