First-time buyer relief stays in place; stamp duty reform delayed until 2027 at earliest
Prime Minister Andy Burnham has ruled out stamp-duty changes in the next Budget, rejecting cross-party pressure for reform. First-time buyer relief (nil rate to £300,000, 5% on £300,001–£500,000) remains stable through 2026, but affordability remains pinched by high mortgage rates.
The government has confirmed that stamp duty will remain unchanged in the forthcoming Budget, putting an end to speculation about reform. Prime Minister Andy Burnham said plainly: "That won't be happening." This comes after a cross-party House of Commons Housing, Communities and Local Government (HCLG) committee called for a consultation on stamp-duty alternatives by the end of 2026 as part of a package to help first-time buyers access homeownership.
Current Stamp Duty Rules for 2026
First-time buyers (properties up to £500,000, primary residence):
- Nil rate on properties up to £300,000
- 5% on portion between £300,001 and £500,000
- Standard rates apply above £500,000
Additional-property buyers (second homes, buy-to-let):
- 5% surcharge on top of standard rates; standard rates begin at £125,000
Payment deadline: Within 14 days of completion.
Broader Housing Affordability Context
While the government has held the stamp-duty line, the HCLG committee warned that home ownership rates in England have declined over 20 years and called for a comprehensive package including increased housebuilding, council powers to recover empty properties, and council-tax reform. The government welcomed a new First-Time Buyer ISA (replacing the Help to Buy ISA) but stopped short of structural tax reform. The mansion tax (2% charge on properties over £2 million) will be collected from April 2028, not affecting mainstream buyers.
For expats and first-time buyers planning a UK property purchase in 2026–2027, stamp duty is no longer an expected source of relief. Budget accordingly: if you are buying a £400,000 first-home property, you will owe £5,000 in stamp duty (5% of the £100,000 above the £300,000 threshold). Combine this with current mortgage costs (5.5–5.65% on average fixed rates) and rising rents, and understand that affordability pressure will remain high until either mortgage rates fall significantly or wage growth accelerates beyond the current rate.
Sources
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