Buyers paying more stamp duty

It has been revealed that the amount of stamp duty being paid by first time buyers has increased by 24.76 per cent in the last 12 months.

Figures from mform show that the average buyer was spending around £2,870 on the tax in 2005/06, while the same buyer can expect to pay £3,581 today.

The firm claims that this is leading to an increasing number of borrowers increasing their mortgage amount in order to cover the initial cost.

According to research, 28 per cent of buyers in the last three years added £3,771 to the value of their mortgage for this purpose in the last three years.

"An extra £3,770 on a mortgage of £150,000 at a currently competitive 6.24 per cent interest for example, would increase monthly repayments from £988.58 to £1,013.42," explained Francis Ghiloni from mform.

"Over 25 years, this would increase the cost by £7,452, which is a significant amount of money.

"As house prices rise, the cost of stamp duty will increase and we expect more people to pay for this by adding it to their mortgage," he added.

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