Landlords are being hit with more stamp duty as they expand their portfolios, thanks to the house price surge pushing homes into higher bands of the tax.
An analysis by Zoopla shows that 4.3m homes have been pushed into a higher stamp duty bracket since March 2020.
Of those some 28 per cent or 1.2m properties have now moved above the initial £125,000 stamp duty threshold in England and Northern Ireland.
In Wales and Scotland rising house prices also mean that a further 360,000 homes have been pushed across the initial threshold at which stamp duty becomes payable - that’s £145,000 in Scotland and £180,000 in Wales.
This is due to an increase in average UK house prices which have risen £29,000, or 13 per cent since the beginning of the pandemic in March 2020 - including a rise of 8.3 per cent in the last year alone.
Landlords of course pay an additional homes stamp duty surcharge of three per cent of a property’s cost as well as the ‘normal’ stamp duty dependent on the band in which a home’s sale price falls.
Gráinne Gilmore, Zoopla’s head of research, says: “Buyer demand has been very strong ever since the end of the first lockdown in 2020, and the start of this year has been no exception.
“This demand, coupled with constrained levels of supply has put upward pressure on pricing - with the average property now worth an additional £29,000 compared to March 2020.
“This has pushed millions more homes into higher stamp duty brackets, meaning that if they come to market, there is an additional cost for buyers.
“While homeowners who make a move will see the benefit from increased property values when they sell, new entrants to the market will have to find additional finance to fund a move.”
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