Stamp Duty's Impact Starts This Month — What Landlords and Homebuyers Need to Know

Introduction

April marks a turning point for the UK housing market as changes to stamp duty thresholds come into effect. These updates are poised to affect millions of buyers—particularly existing homeowners, landlords, and first-time buyers—by significantly increasing the number of property transactions subject to stamp duty. For many, this could mean thousands of pounds in additional upfront costs.

In this blog, we’ll break down the changes, explore who’s most affected, and provide practical advice for navigating the new landscape.

What’s Changing with Stamp Duty in April?

Under the revised stamp duty land tax (SDLT) structure, the temporary cuts introduced in September 2022 are being rolled back. The 2% band, which was removed during the stamp duty holiday, is now being reinstated on properties priced between £125,000 and £250,000.

Here's what that means in practice:

• Homebuyers now face a minimum stamp duty of £2,500 on homes priced over £125,000.

• First-time buyers still benefit from exemptions on purchases up to £300,000, but those buying in higher-value regions like London and the South East will feel the pinch.

Existing Homeowners: The Majority Now Pay

One of the most striking effects of the change is how many more existing homeowners will be impacted.

• 83% of existing homeowners will now pay stamp duty, compared to just 49% before April.

• This means only 17% of repeat buyers will avoid stamp duty altogether.

The financial impact could be substantial, particularly for upsizers or investors targeting properties in mid-range price brackets, where the new band applies directly.

Example: A homeowner buying a property at £200,000 would previously have paid no stamp duty. Now, they'll owe £1,500 (2% on the £75,000 above the £125,000 threshold).

Regional Impact: West Midlands Takes the Biggest Hit

While the changes affect the whole of England, some regions will feel it more than others.

• The West Midlands is expected to see a 66% increase in the number of homebuyers paying stamp duty.

• Other regions seeing big jumps include the East Midlands and Yorkshire, where property prices typically fall within the newly-taxed band.

Landlords and investors looking in these regions should reassess their financial models to account for the added upfront costs.

First-Time Buyers: A Mixed Bag

For first-time buyers, the changes bring both challenges and opportunities.

• The number of first-time buyers liable to pay stamp duty will double to 42%.

• However, 58% will still pay nothing, especially those purchasing under £300,000 in the North and Midlands.

Where It Hurts Most:

• London and the South East: With average first-home prices far exceeding the £300,000 mark, many new buyers here will lose their stamp duty exemption.

• A first-time buyer in London spending £400,000 could now pay £5,000 in stamp duty.

Tip: First-time buyers should time purchases carefully and consult with mortgage advisers to avoid unexpected costs that could affect deposit or renovation budgets.

Stamp Duty and Government Revenue

These changes aren’t just about the housing market—they’re expected to generate an additional £1.1 billion annually for the Treasury.

This signals a continued reliance on property taxes to fund public spending. But it also underlines the need for buyers to prepare smarter and budget more carefully.

Stamp Duty at a Glance: Updated Thresholds for 2025

Property Price	Stamp Duty Rate
Up to £125,000	0%
£125,001 - £250,000	2%
£250,001 - £925,000	5%
£925,001 - £1.5 million	10%
Above £1.5 million	12%

However, First-time buyers pay 0% up to £300,000 and 5% on the portion between £300,001 and £500,000.

What Should Landlords Do Now?

Landlords, particularly those purchasing through limited companies or expanding their portfolios, need to factor in the return of this 2% band when calculating Return on Investment (ROI) and cash flow projections.

Suggestions:

• Review property sourcing strategy: Avoid regions with a sudden stamp duty burden unless the rental yield offsets the cost.

• Consider lease options or partnerships to spread costs.

• Use professional tax advice to structure purchases efficiently.

Action Steps for Buyers and Investors

1. Check the updated stamp duty calculator before making any offer.

2. Add stamp duty costs into your total budget – not just mortgage and deposit.

3. Act swiftly if you're looking at properties under £250k – delaying could cost you thousands.

4. First-time buyers: Explore schemes like Shared Ownership or Help to Buy ISA benefits to stretch your budget.