Conservative Party leader Kemi Badenoch said that if the party won the next general election, it would scrap stamp duty on people’s principal homes.
Rumours have also been circulating around whether Chancellor Rachel Reeves will reform stamp duty and replace it with a property tax.
Figures suggest that around £13.9bn was collected in stamp duty receipts in 2024-25, but much was from second and subsequent properties. Estimates suggest that around £4.5bn came from people’s main homes.
Sarah Coles, head of personal finance at Hargreaves Lansdown, said there are “serious question marks over what it might achieve, and whether it is likely to happen”.
She explained: “Having a tax bill when you buy a home doesn’t make the process any easier, but it’s not necessarily the biggest barrier someone faces when they buy and sell. Take someone downsizing, for instance, from a £750,000 property to a £300,000 one. In England and Northern Ireland, they’d pay £5,000 in stamp duty.
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“It’s a fraction of what they’re likely to pay in estate agency fees and sits along[side] a huge range of costs, from conveyancing to removals. It begs the question of whether removing the cost of the tax is a game-changer.”
Coles added that a first-time buyer pays no stamp duty at all on a property costing up to £300,000, and the challenge for this demographic was raising a deposit.
“It’s also vital to consider the potential impact on the Treasury, where else this money might come from and what other taxes might rise. It’s an interesting addition to the debate, but it’s only a suggestion from an opposition party, and with just under four years to an election, it’s highly likely that things will change between now and then.
“By contrast, there were no new suggestions from the conference hall on changes to stamp duty on shares, which is a needless drag on investors who support the UK market. Given that the government is said to be considering a stamp duty exemption on shares newly listed on the London Stock Exchange in the Budget, this was a missed opportunity to get in ahead of any announcement,” she noted.
Nearly half of FTB properties free from stamp duty
Data also shows that a lot of first-time buyer properties are stamp duty-free in England.
Rightmove figures show that in England, only 40% of available homes for sale are stamp duty-free for first-time buyers in 2025, and this goes down to 5% for homemovers.
There is also significant regional variation, with 76% of available homes in the North East exempt from stamp duty, compared to just 11% in London.
Looking at homemovers, at one end of the spectrum is the North East, where 27% of available homes are stamp duty-free for homemovers, while this is 0% in London.
| Region | Proportion of available homes for sale that are stamp duty-free for first-time buyers in 2025 | Proportion of available homes for sale that are stamp duty-free for homemovers in 2025 |
| East Midlands | 59% | 5% |
| East of England | 36% | 2% |
| London | 11% | 0% |
| North East | 76% | 27% |
| North West | 61% | 10% |
| South East | 26% | 1% |
| South West | 37% | 3% |
| West Midlands | 53% | 5% |
| Yorkshire and the Humber | 64% | 11% |
| England | 40% | 5% |
Source: Rightmove data
Colleen Babcock, Rightmove’s property expert, said: “We’ve been calling for stamp duty reform for some time now, as it’s a significant barrier for many people moving home. Abolishing it completely would remove one of the biggest barriers to moving, unlocking more moves at all stages of the property ladder.
“Looking ahead to November’s Budget, we would urge the government to review how stamp duty could be changed. Even changing the thresholds would be a helping hand for some, but if there was the possibility to go even further, it would be a huge step forward for mobility across the property market.”
Stamp duty removal could be ‘caffeine jolt’ for market but questions over FTB impact
George Abouzolof, senior mortgage broker at Clifton Private Finance, said scrapping stamp duty would be “one of the most radical housing market reforms” in recent decades, and would remove “one of the biggest upfront barriers to buying or moving home”.
“For homeowners and sellers, it could unlock long-stalled movement in the market. Many people delay moving because of the high cost of stamp duty, so removing that friction could boost transactions, improve mobility and help match homes more efficiently to people’s needs.
“First-time buyers, in particular, would feel an immediate benefit. Abolishing stamp duty would make it easier to get onto the property ladder, especially in areas where prices are already stretching affordability,” he said.
However, he said borrowers who had paid substantial sums in stamp duty in recent years may feel “frustrated”.
“Many homeowners who stretched to move or upgrade could feel they’ve missed out, having paid tens of thousands in tax that new buyers might now avoid. That sense of unfairness will need to be handled carefully to avoid backlash from those who feel disadvantaged by timing.
“The pledge isn’t without risks. If demand surges and supply can’t keep up, we could see upward pressure on prices, particularly in areas like London and the South East. Landlords may also see this as an opportunity to expand their portfolios more affordably, which could further fuel price increases and make it harder for first-time buyers to compete,” Abouzolof added.
He noted that Labour is likely to “push back strongly on this point, arguing that such a policy could push prices further out of reach for ordinary buyers”.
“It’s also a tactical move by the Conservative leader, putting pressure on the Chancellor ahead of the highly anticipated Autumn Budget and framing the party as the champion of lower taxe[s] and homeownership.
“The intention behind the policy is clear: to remove friction, stimulate movement and reduce upfront costs to create a healthier housing market. But, as ever with housing reform, the impact will depend on the detail.
“Done well, it could reinvigorate the property market and make homeownership more attainable. Done poorly, it risks fuelling inflation and widening regional divides. The principle is promising, but the right implementation will be crucial to its success,” Abouzolof said.
Stuart Cheetham, CEO of MPowered Mortgages, said this was a real “rabbit out of the hat” moment, but it could be an “albatross if the Tories defy the odds and win the next election”.
“Stamp duty isn’t just the bane of house buyers or the plaything of politicians. It generates billions for the Treasury every year. In 2023-24, people buying homes paid £8.6bn of stamp duty straight into government coffers – and the figure is likely to have been even higher in the latest tax year.
“Promising to [forgo] billions in tax revenue is bold stuff, and one of the few privileges enjoyed by opposition parties. No party currently in office would dare give away so much revenue, given the weakness of the government’s finances,” he said.
Cheetham said scrapping stamp duty would be “very popular, and it would deliver a huge caffeine jolt to the sluggish property market”.
“But there’s also a risk that it would drive up prices so fast that any savings for first-time buyers would soon be cancelled out.
“In fact, the total abolition of stamp duty would deliver the biggest tax breaks to everyone but first-time buyers. People buying a second home or very expensive properties would save the most tax. First-time buyers currently pay no stamp duty on properties costing less than £300,000 – and the changes would do nothing for them.
“Kemi Badenoch’s announcement will fly when it comes to headlines, but on every other count, it’s unlikely to get off the ground,” he said.
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