First time buyers struggle to find stamp duty exempt homes in London

First time buyers in London are struggling to take advantage of the stamp duty exemption announced last year as there are few properties priced low enough to meet the £300,000 or less price criteria to avoid paying the tax.

New research from online estate agents HouseSimple shows that there are just 387 homes for sale in London Travel Zones 1 and 2, that would be stamp duty exempt for first time buyers and when Zone 3 is added it rises to 1,235.

The borough of Kensington and Chelsea has the fewest stamp duty exempt properties, with just six, including a tiny 113 square foot studio flat in Earls Court. The boroughs of Camden and City of Westminster, both have just 18 stamp duty exempt properties currently on the market.

It suggests that first time buyers should head to the borough of Croydon, which is travel Zone 5-6, for the largest number of stamp duty exempt properties on the market today. Croydon has 795 properties at £300,000 or less, more than double the number in any other London borough.

The reality is, that most first time buyers will still have to pay stamp duty if they’re hoping to buy in inner London. According to HouseSimple figures, there are 4,490 properties in Zone 1-2, and 7,687 properties in Zone 1 to 3, that are currently on the market at between £300,001 and £500,000, and would be eligible for a £5,000 stamp duty cut.

‘The Chancellor wheeled out his big tax break offering last Autumn to help first-time buyers and attract young voters. Unfortunately for the young London buyer, the stamp duty cut, while beneficial to large swathes of the country, won’t make much of a dent in their house buying budget,’ said HouseSimple chief executive officer Sam Mitchell.

‘Even a stamp duty saving of £5,000 on properties up to £500,000, which is not something to be sniffed at, won’t be much help if first time buyers don’t have the funds in the first place to put down substantial deposits needed to buy even a basic starter home in Inner London,’ Mitchell pointed out.

‘London is seeing an exodus of young professionals, who would prefer to move to more affordable areas of the country, than buy in outer London, and face long commutes every day. With the growth of business hubs in many other major cities, and the cost of housing considerably lower than in the capital, London is no longer the economic draw it used to be,’ Mitchell added.