London’s first-time buyers just got hit with some bad news. If you were already struggling to get on the property ladder, buckle up because the government’s latest stamp duty change is making things even worse. A new study by Compare My Move reveals that first-time buyers in some boroughs will see their stamp duty land tax (SDLT) increase by a staggering £11,250 after April 1st, 2025. Meanwhile, those moving house in London will only face a £2,500 increase, regardless of where they buy. In a city where affordability is already a joke, this tax hike is making London an even tougher place to buy your first home.
Stamp Duty Hikes: Which Boroughs Get Hit the Hardest?
Not all boroughs will suffer equally. First-time buyers in areas with more affordable housing are actually facing the steepest increases. Boroughs like Lewisham, Greenwich, and Waltham Forest will see first-time buyer SDLT jump from just over £5,000 to nearly £17,500—a 224% increase in some cases. In total, 16 out of 33 London boroughs will be paying more than the standard £2,500 increase, with nine boroughs facing the full £11,250 hike.
Here are some of the worst-hit boroughs:
- Lewisham – Stamp duty increase: £11,250 (from £5,014 to £16,264)
- Enfield – Stamp duty increase: £11,250 (from £5,857 to £17,107)
- Greenwich – Stamp duty increase: £11,250 (from £8,686 to £19,936)
- Tower Hamlets – Stamp duty increase: £11,250 (from £6,047 to £17,297)
Meanwhile, wealthier boroughs like Kensington and Chelsea, Westminster, and Camden will only see an increase of £2,500, despite their homes being £1 million+ more expensive.
Why First-Time Buyers Are Paying More Than Home Movers
The biggest question—why are first-time buyers getting hit harder than existing homeowners? The government’s new SDLT structure unfairly targets lower-cost properties in London, where first-time buyers typically shop. The average house price in boroughs facing the £11,250 tax increase is £558,000, compared to £906,000 in the wealthier boroughs facing only a £2,500 rise.
In simple terms, the people who can least afford the increase are paying the most.
Will London’s First-Time Buyers Flee the Capital?
According to Halifax, London is the only region in the UK where first-time buyers have declined in the past 10 years, dropping by 8%. With this latest tax hike, that number could plummet even further. Compare My Move founder Dave Sayce believes we’ll see even more young buyers ditching London for cheaper areas.
“With property prices growing, it’s getting harder and harder to get onto the property ladder in London. This change in stamp duty ensures that buying in London becomes even harder,” he explains.
“Because the average house price is higher in London than anywhere else in the UK, but the tax brackets remain UK-wide, it also means that the more affordable boroughs are getting hit with SDLT three or four times more than they would have paid, while wealthier boroughs are only seeing increases of 1%-13%.”
What Can First-Time Buyers Do?
If you’re hoping to buy your first home in London, you might need to speed up your plans. Buyers who complete their purchase before April 1st, 2025, will avoid the tax increase. If you’re close to securing a deal, pushing to exchange sooner rather than later could save you thousands.
For those still saving, consider looking outside of London. With average house prices £300,000-£400,000 cheaper in cities like Manchester and Birmingham, buying elsewhere might be the only way to avoid these crushing tax increases.
London’s First-Time Buyers Need a Break
London’s housing market has never been easy, but this new tax hike is pushing first-time buyers further away from homeownership. With some boroughs facing stamp duty increases of over 200%, it’s clear that the dream of owning in the capital is slipping out of reach for many young Londoners.
Unless something changes, expect to see more and more first-time buyers packing their bags and heading out of the city—because at this rate, owning in London is starting to look impossible.
