Budget 2024: Stamp duty rise to hit second homeowners from tomorrow whilst first-time buyers benefit

Rachel Reeves has announced a big change to stamp duty tax during Labour's first Budget. The Chancellor of the Exchequer delivered the Autumn Budget on Wednesday (October 30) with announcements on taxes, wages, pensions, benefits and the cost of living.

The UK’s first female Chancellor set out Labour's priorities in the House of Commons as she strived to 'secure stability to this country, fix foundations and deliver change through responsible leadership'.

The Labour party said it will need to make 'tough decisions' after claiming to have inherited a £22bn 'black hole' in the public finances from the Conservative government.

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Amongst the new rules set to come into force in the property sector, Rachel Reeves announced changes to stamp duty - one of the upfront costs that buyers pay when purchasing a property.

The Chancellor has revealed a stamp duty hike for second-home buyers and landlords, with the additional stamp duty rate rising from 3 percent to 5 percent from tomorrow (October 31) for homes with a purchase price between £40,000 and £250,000.

The current rates for the remaining stamp duty second-home tiers include:

• Between £250,001 and £925,000: 8%
• Between £925,001 and £1.5 million: 13%
• Over £1.5m million: 15%

Meanwhile, in better news for new homeowners, first-time buyers will continue to be exempt from paying stamp duty on properties priced up to £425,000. If a property is priced higher than this, they only pay tax at 5 percent above £425,000 and up to £625,000.

The stamp duty exemption was temporarily increased in 2022, but was scheduled to revert back to £300,000 in April 2025. However, the Chancellor has confirmed that the current thresholds will be made permanent, meaning first-time buyers will benefit for longer.