FTBs told to act now to avoid stamp duty

First-time buyers (FTB) have been advised to act now or risk having to fork out extra when they buy a home, as the exemption from having to pay stamp duty for those who are taking their first step onto the UK property ladder ends in two months time.

The National Association of Estate Agents (NAEA) has said that those who are considering purchasing property for sale have to keep their eye on the March 24th deadline as it continues to draw nearer, because it could end up costing them much more than they had originally intended to spend.

It said that it is important that people who are in the process of buying their first house now should make sure that they keep up good communication levels with everyone involved in the chain of purchase, especially their solicitor, to ensure that everything is running smoothly and they do not end up running past the cut-off date accidentally.

Wendy Evans Scott, president of the NAEA said: "First time buyers are key to a healthy property market. We hope to see the number of people completing the purchase of their first home continuing to increase through February and March, as many FTBs are keen to purchase their first home before the tax exemption deadline."

Those who fail to beat the deadline face paying stamp duty on any home they buy which costs them more than £125,000. They will pay one per cent of the value on homes costing up to £250,000 and three per cent of the value of a home costing more than this amount.

The NAEA said it fears that the additional cost of one per cent could see many people unable to afford to buy a property. However, Gary Styles, strategy, risk and economics director at Hometrack, said recently that his company does not believe the difference will be too significant.