Andy Burnham, the newly appointed Prime Minister from the Labour Party, has been urged to implement changes to stamp duty rules affecting older homeowners. A recent report by the Radix Big Tent housing commission advocates for pensioners to receive the same stamp duty relief currently available to first-time buyers, aiming to encourage them to sell larger family homes and downsize.
The commission highlights that existing stamp duty regulations may be preventing older people from moving to more suitable properties, thereby limiting availability in the housing market. They suggest that extending stamp duty relief to pensioners could potentially bring approximately 870,000 family homes back onto the market.
Currently, in England and Northern Ireland, no stamp duty is payable on the first £125,000 of the purchase price of a main residential property. However, first-time buyers benefit from a higher threshold, with no stamp duty due on the first £300,000. Scotland has different rates and thresholds but similarly offers a higher exemption amount for first-time buyers.
Alex Notay, chairman of the housing commission, commented on the situation, noting that the UK faces “a stark and growing generational housing divide.” Ben Rich, chief executive of Radix Big Tent, added, “We have to be more radical if we are really going to get the housing market moving again, which means incentivising older people to find homes better suited to their needs.”
Responding to the suggestions, a Treasury spokesman stated, “As has always been the case, decisions on tax are a matter for the Chancellor to set out at fiscal events, rather than routinely commenting on rumour, speculation or proposals.”