More than two-thirds of all first time buyers have paid, or will be liable to pay, Stamp Duty, according to Bradford & Bingley.
The unrelenting rise in UK property prices has caused 68% of first time buyers to become liable for stamp duty, with 12% expecting to pay 1% or more, according to research into first time buyers commissioned by Bradford & Bingley.
Andy Wiggans, director of mortgages for Bradford & Bingley, says: “Stamp Duty was never designed to be a tax on first time buyers, yet it now affects a vast proportion of them and is seriously hampering their ability to get a foothold on the property ladder.
The average first time buyer now has to find over £1,000 to pay this tax, at a time when most are struggling to even fund a deposit.
Other findings of the research show that 52% of first time buyers though costs such as Stamp Duty were higher than they expected, 11% are receiving parental support to pay Stamp Duty, and 11% have had to reduce their deposit to cover the cost of Stamp Duty.
The research also reveals that, despite affordability concerns, 46% of first time buyers are desperate to get on the housing ladder as they feel houses will only become less affordable in the future.
SmartNewHomes.com has called on the chancellor, Alistair Darling, to scrap Stamp Duty for first time buyers in order to make housing more affordable.
Dave Bexon, managing director of SmartNewHomes.com, says: “Stamp duty should be scrapped for all first time buyers – plain and simple.
"If the Chancellor is serious about helping first time buyers in the face of rising interest rates and spiralling house prices, he should scrap stamp duty tax altogether for this beleaguered group.”
The Government is due to release details of new measures to tackle the housing crisis and make homes more affordable.
Today, the chancellor said that the Treasury was looking at problems with short-term fixed-rate mortgages as part of the Government’s new strategy.
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