"First-time buyers form a core part of market activity and stamp duty free incentives are a big draw when looking to reduce the cost of purchasing."
- Co-founder and CEO of GetAgent, Colby Short
Estate agents in the East of England could face the toughest task filling the void left by first-time buyer stamp duty relief, should the new Labour Government decide not to keep the current threshold of £425,000 in place, according to new research by estate agent comparison site, GetAgent.
First-time buyers currently pay no stamp duty on homes priced up to £425,000 and while Labour have committed to keeping this rate of stamp duty relief fixed for the time being, the party has made no commitment to extending it beyond the deadline that falls at the end of March 2025.
This suggests that when this deadline does arrive, the level of stamp duty relief afforded to first-time buyers will revert back to the previous threshold of homes up to £300,000.
GetAgent says a return to the £300,000 threshold could "prove problematic" and "dramatically reduce the number of homes available offering the additional draw of a stamp duty free purchase".
Its analysis of current market listings shows that across England, 66.5% of all homes listed for sale currently come in below the stamp duty free threshold of £425,000. However, just 45.6% are listed at £300,000 or less, meaning that should stamp duty relief revert back to this threshold, it would reduce available stock by 20.9%.
Agents in the East of England could face the toughest challenge should first-time buyer stamp duty relief return to purchases up to £300,000. Currently 66.8% of all homes listed for sale are priced at £425,000 or less, whilst just 41.1% of for sale stock sits at £300,000 or below, meaning that it would reduce stamp duty free stock availability for first-time buyers by 25.7%.
Agents in the South West (-24.9%), South East (-24%), West Midlands (-21.4%) and London (-19.1%) could also see a drop in first-time buyer market activity as they rank within the top five regions that would see the largest reduction in stamp duty free for sale stock at the £300,000 threshold.
Co-founder and CEO of GetAgent, Colby Short, commented: “First-time buyers form a core part of market activity and stamp duty free incentives are a big draw when looking to reduce the cost of purchasing. Therefore if the threshold returns to £300,000 it could see agents hit with a significant reduction in demand due to the stock they are able to offer and the number of first-time buyers it attracts.
"They can also be preferable to sellers and agents alike as they offer a chain-free purchase which can help transaction speed, certainty and of course, cash flow.
"The very best agents will likely be going through their databases now trying to get affected vendors onto the market and completed before any incentives are removed.”
