Lender calls for stamp duty review

Bradford & Bingley has called for a review of stamp duty in the UK mortgage market, describing it as a "stealth tax".

According to research by the firm, 68 per cent of first-time buyers (FTBs) have paid or will be liable to pay stamp duty, which is currently triggered when properties have a price of £125,000 or more.

Some 12 per cent of new buyers expect to pay more than one per cent, which is the duty charged on properties with a value of between £125,000 and £250,000.

Bradford & Bingley claims that the situation is "only set to worsen" as affordability is stretched and interest rates are continuing to go up.

Despite the problems that they face, however, FTBs are still eager to get on the property ladder, with 46 per cent of would-be buyers expressing concern that if they don't buy now, they will soon be priced out of the market.

Andy Wiggans, director of mortgages for Bradford & Bingley, said: "Stamp duty was never designed to be a tax on first-time buyers, yet it now affects a vast proportion of them and is seriously hampering their ability to get a foothold on the property ladder.

"The average first-time buyer now has to find over £1,000 to pay this tax, at a time when most are struggling to even fund a deposit."

Mr Wiggans urged the government to undertake a wholesale review of stamp duty and stop adopting "piecemeal measures".

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