After analysing its listings across 12 months then comparing listing prices to tax thresholds across England, Scotland and Wales, the firm has revealed where first-time buyers are least and most likely to pay tax.
Transaction tax thresholds for first-time buyers are currently defined as follows:
- England: Stamp Duty Land Tax (SDLT) - £300,000 threshold
- Scotland: Land and Buildings Transaction Tax (LBTT) - £175,000 threshold
- Wales: Land Transaction Tax (LTT) - £180,000 threshold
Zoopla’s analysis highlights that Scotland is home to the highest percentage of properties (61%) that are exempt from LBTT, compared to 58% of homes in England being exempt from SDLT, with 56% of residential property in Wales being exempt from LTT.
Zoopla’s research also reveals the post town areas in the UK where first-time buyers are most and least likely to buy without paying any tax on transactions, based on exemption thresholds. With just under 100% (99.6%) of all properties being priced under the SDLT threshold, the towns of Bootle in Merseyside and Shildon in County Durham top the list of places where first-time buyers are least likely to pay any Stamp Duty. In third place is Heckmondwike in West Yorkshire (99.2%), whilst Blyth in Northumberland, where 99% of homes don’t require first-time buyers to pay Stamp Duty, is fourth.
At the other end of the spectrum, Beaconsfield in Buckinghamshire has the fewest amount of properties where first-time buyers are exempt from paying Stamp Duty - just 1.7% of homes available in the town were priced under the tax threshold. Ingatestone in Essex is in second place (2.0%), and Chalfont St Giles in Buckinghamshire is in third (3.4%).
In London, Zoopla analysed listings across boroughs for those under the Stamp Duty threshold of £300,000, whilst also looking at the percentage of properties where first-time buyers would receive a proportion of SDLT relief due its sale price being £500,000 or below.
In first place for Stamp Duty exemption and partial relief was the London Borough of Croydon, where 26.8% of homes were for sale for under £300,000 across the 12 months, rising dramatically to 81.7% where FTBs were able to receive some relief. Unsurprisingly the London Borough of Kensington and Chelsea, home to some of the UK’s most expensive addresses, only had 9.2% of homes where first-time buyers received any tax relief when purchasing a home.
Laura Howard, spokesperson for Zoopla, comments: “Our recent research revealed that first-time buyers are set to be the largest buyer group of 2019 - and indications are that many have been bolstered by the SDLT relief that applies to a typically-priced, entry level property.
59% of all homes currently for sale are exempt from stamp duty- or its country’s equivalent. This is certainly unlocking the prospect of homeownership for many first-time buyers, who might otherwise struggle to gather enough cash to cover all the upfront costs.
First time buyers are new to the buying process, so agents have a key role to play in providing helpful information on the transaction process, and by making the stamp duty thresholds clear – it could help to build a trusted agent-buyer relationship that will last for years to come.”
