View more on these topics

Halifax reveals 281% rise in Stamp Duty

Halifax estimates there has been a shocking 281% rise in the number of home sales in England and Wales attracting a 3% rate of Stamp Duty in the past five years.

The number of properties priced above the £250,000 threshold at which a 3% rate of Stamp Duty is levied has increased from 73,403 in 2001 to 279,408 in 2006.

This accounts for 19% of total home buyers that were faced with a Stamp Duty bill of at least £7,500.

The bank attributes 89% of the rise in Stamp Duty revenue of the past five years to an increase in the amount raised at the higher Stamp Duty bands – 3% on sales between £250,000 and £500,000 and 4% above £500,000.

Total Stamp Duty revenue from residential property sales was £4.6bn in 2005/06, up 114% from the £2.1bn raised in 2000/01.

Stamp Duty revenue raised from sales of properties valued at more than £250,000 rose by 175% from £1.2bn in 2000/01 to £3.4bn in 2005/06.
The higher Stamp Duty bands accounted for 74% of total residential Stamp Duty revenue in 2005/06 compared with 58% in 2000/01.

Halifax estimates that 3.5 million English and Welsh properties, or 19% of housing stock, are now valued above the £250,000 Stamp Duty threshold and 600,000 or 3% are valued above the £500,000 threshold.

London and the South East account for 64% of homes valued above £250,000 and 77% of homes valued above the £500,000 threshold.

There has been a more than four-fold increase in the number of postcodes where the average house price is above the 3% Stamp Duty threshold.

The average house price in 485 postcode districts in England and Wales is now above the £250,000 threshold, compared to 111 districts in 2001.

There are 206 postcode districts in England and Wales which have seen at least a 30 percentage point increase in the proportion of home sales above the 3% Stamp Duty threshold over the past five years.

The largest increase has been in BR4 in West Wickham in London, up 60 percentage points from 19% of sales in 2001 to 79% in 2006. The next biggest increases were in IG4 in Ilford in London with a 59 percentage point increase and GL19 in Gloucester with a 55 percentage point rise.

Sales above the 3% Stamp Duty threshold accounted for at least 25% of property sales in 667 postcode districts across England and Wales in 2006, compared with 181 districts in 2001.

These include 71% of London postcode districts and 54% of postcode districts in the South East.

All regions of England and Wales have at least 5% of postcode districts with more than 25% of home sales above the 3% Stamp Duty threshold.

SW7 in Kensington and SW1W in Sloane Square in London are the two postcode districts with the highest percentage of sales above the 3% Stamp Duty threshold – at 98% and 97% respectively.

B94 in Solihull is the postcode district with the highest proportion of housing sales above the 3% threshold outside the south of England (78%), followed by NE20 near Newcastle upon Tyne (70%).

The Stamp Duty payable on the average house sale has at least tripled in 18% of postcode districts over the past five years, reflecting a shift in the average Stamp Duty rate from 1% to 3% in these districts.

YO62 in York has seen the biggest increase with the average bill up 601% from £1,087 in 2001 to £7,620 in 2006. WN8 (585%) near Pemberton in the North West and TR26 (583%) in St Ives in the South West have seen the next biggest rises.


Lenders split on further rate rises

Lenders are split on whether further rate rises are likely in order to bring inflation back under control. This follows the Bank of England’s decision to freeze interest rates at 5.25% in March. Stephen Leonard, director of mortgages at Alliance & Leicester, says: “Over recent past weeks there has been growing consensus in the market […]

Changes that mean we will all suffer

The Home Information Pack issue is becoming increasingly farcical. Leaving aside the question of whether or not they are a good idea in the first place, the confusion that surrounds them is palpable.

Woolwich unveils two-year fixed rate

Woolwich is returning to the two-year fixed rate market as swap rates begin to stabilise. The new rate will be set at 5.39%, with a follow-on rate of 0.95% above base rate. The product will complement the range of tracker, capped, offset and long-term fixed rates already on offer.

Countrywide board recommends Apollo takeover

The board of Countrywide has agreed the 1bn takeover proposition made by private equity firm Apollo Funds. In an announcement on the London Stock Exchange, the estate agency confirmed that it has reached an agreement on the terms of a recommended offer by Castle BidCo, the company incorporated on behalf of Apollo for the purpose […]


News and expert analysis straight to your inbox

Sign up