If you’re a first-time buyer (FTB) purchasing a home over £425,000 in England or Northern Ireland, you’ll need to pay stamp duty.
If the property (or land) is below this amount, you can avoid it altogether.
The rules are different for existing homeowners in England and Northern Ireland, where stamp duty kicks in for properties costing £250,000.
Those buying a home that won’t be their primary residence will pay an additional 3% surcharge on the entire price of the property.
And buyers from overseas will pay an additional 2% surcharge.
In Scotland, first-time buyers are exempt from paying stamp duty on properties that cost up to £175,000.
For those who aren't FTBs, the stamp duty threshold is £145,000.
In Wales, there isn’t separate relief for first-time buyers. Instead, everybody has to pay the tax on properties that cost £225,000 or more.
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In this article, we explore locations with the largest proportion of homes under the first-time buyer stamp duty threshold.
If you are already on the housing ladder but looking to make a next move, check out the top locations where homeowners can avoid paying stamp duty.
Why is it important to know about stamp duty?
A stamp duty bill can be expensive.
First-time buyers tend to look for more affordable homes, but even smaller homes in high value areas can cost tens of thousands in stamp duty.
A first-time buyers’ stamp duty bill for the average-priced home (£265,000) across the UK would be:
£0 in England and Northern Ireland
£2,225 in Scotland
£2,400 in Wales
Currently, nearly 3 in 5 (60%) homes listed for sale on Zoopla are priced below local stamp duty thresholds for a first-time buyer.
This translates to 270,000 homes that could be exempt from stamp duty for FTBs.
Where in the UK can first-time buyers avoid stamp duty?
The table below shows the regions with the highest proportion of homes under the FTB stamp duty threshold in each region.
|Region/Country||Avg house price||Proportion of homes for sale below FTB stamp duty threshold||No. of homes for sale on Zoopla below regional threshold|
|Yorkshire & The Humber||£185,400||85%||25,500|
|East of England||£340,200||60%||30,200|
Our historical analysis shows that 60% of all stamp duty receipts are paid in the South East and London.
Homes in the south are the most expensive in the country and finding a home below the tax threshold is much harder here.
In fact, only half of our homes listed in the south are priced below £425,000.
In the Midlands, 4 in every 5 of our homes for sale cost less than £425,000
Meanwhile, in the north of England, where homes are among the most affordable in the UK, we find that 9 in 10 homes (88%) on the market could be bought by a first-time buyer without incurring the tax.
This increases to 93% in the north east, where the average house price is below £140,000.
In Scotland and Wales, where the stamp duty tax regime is different to that in England, we find 46% and 43% of homes don’t qualify for the tax if purchased by a first-time buyer.
The proportion is lower because the threshold for exemption is lower: £225,000 in Wales and £175,000 in Scotland.
In Scotland, the threshold is below the average house price for the region.
Regional towns are the best places to avoid stamp duty
The largest proportion of homes exempt from stamp duty can be found in the regional towns of northern England.
Four local authorities in the north share the top spot for the highest proportion of homes on the market below the FTB stamp duty threshold: Hull, Blackpool, Middlesbrough and Hartlepool.
We find that 98% of homes marketed in these areas would incur no stamp duty tax bill for FTBs.
All of these areas are either the cheapest or among the cheapest areas to buy within their respective regions, with average house prices below £125,000.
Looking beyond northern England, where average homes fetch higher prices, properties priced below the stamp duty threshold for FTBs are still relatively common.
In Stoke-on-Trent, 96% of homes currently for sale would be exempt from stamp duty for FTBs, the highest proportion anywhere in the Midlands.
Ipswich is a winner in the South, with 88% of homes on the market below the FTB stamp duty threshold.
FTBs in London will find most properties exempt from stamp duty in Barking and Dagenham, where 7 out of 10 homes are priced below £425,000.
In Wales, Blaenau Gwent has an unmatched level of homes below the Land Transaction Tax threshold, with 78% of homes on the market priced below £225,000.
Meanwhile, Aberdeen offers the broadest selection of properties for first-time buyers looking to avoid paying the Land and Buildings Transaction Tax.
|Region||LA with highest proportion of homes under FTB stamp duty threshold||% of homes for sale||Avg house price|
|Yorkshire & The Humber||Hull||98%||£113,200|
|East of England||Ipswich||88%||£218,000|
|London||Barking & Dagenham||69%||£334,100|
Where is it hardest to avoid paying stamp duty?
With the highest house prices anywhere in the country, it comes as no surprise that London has the fewest homes that could be purchased without incurring a stamp duty bill, despite the generous first-time buyer relief.
A quarter of homes listed for sale in the capital - or 22,000 homes - would qualify for FTB exemption.
Outside of London, Monmouthshire in Wales has the second lowest concentration of homes below the land transaction tax threshold of £225,000. Only 1 in 8 homes listed for sale int this area is exempt from the tax.
Edinburgh ranks third for the fewest homes below the LBTT threshold: only 1 in 6 homes on the market cost less than £175,000.
Over in England, just 1 in 4 homes are below the £425,000 threshold in St Albans and Elmbridge.
How to avoid stamp duty when buying your first home
Our price filters can help you find the home that fits your budget and falls below the stamp duty tax threshold.
You can also use Zoopla’s Stamp Duty calculator to find out more about the stamp duty tax, differences between different countries within the UK and how it may impact your next home move.