Quarter of first-time buyers unprepared for stamp duty costs

Average first-time buyer deposit now £27,500

Around 22 per cent of first-time buyers are not taking into account the cost of stamp duty before making an offer on a home, according to TSB.

Similarly, one in seven buying their second or third homes are not setting aside specific amounts to cover stamp duty.

Homehunters are most aware of stamp duty in the East of England (50 per cent), the south west (49 per cent) and south east (48 per cent). One in four in the north west and Wales are failing to plan for it before making an offer.

The research also found the average stamp duty is now over £5,000 which has meant one in ten have capped their bid for a property so that they fall into a lower stamp duty bracket. 

Although personal savings, mortgage extensions and loans from family are the most popular ways to cover the cost of stamp duty, aound 10 per cent of first-time buyers use a credit card to pay.

Ian Ramsden, TSB's Director of Mortgages, said: "With the expenditure on stamp duty equivalent to a tenth of the average deposit, it is important for potential homebuyers to factor it in to their purchase decision at an early stage. 

Housing recovery spreads beyond London and the South-east

Meanwhile, a second report suggests that the average first-time buyer purchase price in January was a new high of £155,832, up £5,000 over the previous month.

The figures from LSL Property Services indicate that as a result the average first-time buyer deposit also rose to a record level of £27,519 and that deposits are growing as a proportion of income. The average deposit represented just over 75 per cent of a first-time buyers income in January 2014, up from 74.7 per cent in December 2013.

David Newnes, director of estate agents Your Move and Reeds Rains, part of LSL Property Services group, said: "While the property market has been firing forwards, wage growth has been stuck in the mud of the economic recovery. Prices for first-time buyer properties have been marching steadily upwards, and have now reached a new record. 

The report also showed that:

* London and the South East were home to 38 per cent of UK first-time buyer transactions

* The average deposit was £64,160 in London, compared to £13,393 in Northern Ireland and £13,814 in Wales

* First-time buyers also paid the most for their homes in London at £282,537 - the cheapest region was Northern Ireland at £87,839.

Discover more property articles at Homes and Property
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: SEO Specialist

£21000 - £34000 per annum: Recruitment Genius: This is an opportunity for an e...

Recruitment Genius: In House Counsel - Contracts

Negotiable: Recruitment Genius: This leading supplier of compliance software a...

Recruitment Genius: Associate System Engineer

£24000 - £30000 per annum: Recruitment Genius: The Associate System Engineer r...

Recruitment Genius: Executive Assistant

Negotiable: Recruitment Genius: An Executive Assistant is required to join a l...

Day In a Page

General Election 2015: The masterminds behind the scenes

The masterminds behind the election

How do you get your party leader to embrace a message and then stick to it? By employing these people
Machine Gun America: The amusement park where teenagers go to shoot a huge range of automatic weapons

Machine Gun America

The amusement park where teenagers go to shoot a huge range of automatic weapons
The ethics of pet food: Why are we are so selective in how we show animals our love?

The ethics of pet food

Why are we are so selective in how we show animals our love?
How Tansy Davies turned 9/11 into her opera 'Between Worlds'

How a composer turned 9/11 into her opera 'Between Worlds'

Tansy Davies makes her operatic debut with a work about the attack on the Twin Towers. Despite the topic, she says it is a life-affirming piece
11 best bedside tables

11 best bedside tables

It could be the first thing you see in the morning, so make it work for you. We find night stands, tables and cabinets to wake up to
Italy vs England player ratings: Did Andros Townsend's goal see him beat Harry Kane and Wayne Rooney to top marks?

Italy vs England player ratings

Did Townsend's goal see him beat Kane and Rooney to top marks?
Danny Higginbotham: An underdog's tale of making the most of it

An underdog's tale of making the most of it

Danny Higginbotham on being let go by Manchester United, annoying Gordon Strachan, utilising his talents to the full at Stoke and plunging into the world of analysis
Audley Harrison's abusers forget the debt he's due, but Errol Christie will always remember what he owes the police

Steve Bunce: Inside Boxing

Audley Harrison's abusers forget the debt he's due, but Errol Christie will always remember what he owes the police
No postcode? No vote

Floating voters

How living on a houseboat meant I didn't officially 'exist'
Louis Theroux's affable Englishman routine begins to wear thin

By Reason of Insanity

Louis Theroux's affable Englishman routine begins to wear thin
Power dressing is back – but no shoulderpads!

Power dressing is back

But banish all thoughts of Eighties shoulderpads
Spanish stone-age cave paintings 'under threat' after being re-opened to the public

Spanish stone-age cave paintings in Altamira 'under threat'

Caves were re-opened to the public
'I was the bookies’ favourite to be first to leave the Cabinet'

Vince Cable interview

'I was the bookies’ favourite to be first to leave the Cabinet'
Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat