There’s been a lot of noise in the media recently about possible changes to stamp duty and wider property taxes. Reports suggest the government is considering replacing stamp duty with a new annual property tax – but nothing has been confirmed yet.
“Any changes to stamp duty or property taxes will ripple quickly through local markets like Hitchin. Buyers here are often balancing affordability with long-term investment, so removing or reshaping upfront costs could open the door for more families to make a move. As an experienced Estate Agent in Hitchin, I see first-hand how tax policy directly influences confidence and activity in the market.”
Nick Wellington, Estate Agent and Director at Wellington Evans, Hitchin
Here’s a breakdown of what’s being discussed, and what it could mean for buyers, sellers, and movers.
What the reports are saying
According to recent coverage, ministers are said to be looking at replacing stamp duty with a proportional property tax for homes worth over £500,000.
- Who pays? Under this idea, sellers would pay the tax rather than buyers.
- How much? The suggested rate is around 0.54% per year on the portion of a property’s value above £500,000 – though the government could set the figure higher or lower.
- Example: Selling a £650,000 home could mean around £810 a year in property tax, compared with today’s one-off £22,500 stamp duty bill for the buyer.
- Exemptions? Reports suggest second homes would remain under the current stamp duty system.
If introduced, this would be a major shift in how property transactions are taxed.
Who could be most affected?
- First-time buyers – Removing the upfront cost of stamp duty could make it easier to get onto the ladder, though sellers may build the tax into their asking prices.
- Upsizers & Downsizers – Those selling higher-value homes could see new costs. For downsizers, the proposed tax could still apply even if moving to a cheaper property.
- Regional differences – The impact would vary across the country. In London, 59% of homes are over £500,000, compared with just 8% in the North East. The South East would also feel changes more strongly than the Midlands or the North.
- Renters – Lower upfront costs for buyers might boost demand, but if asking prices rise, deposits could remain a hurdle. Some owners may even choose to rent their homes rather than sell while things remain uncertain.
Other property tax changes being discussed
It isn’t just stamp duty on the table. Other reports suggest:
🏠 Council tax reform – Potentially replaced with a local property tax of around 0.44% on homes worth between £80,000 and £500,000, capped at £2,200. Unlike today, the bill would fall on property owners, not residents.
💷 ‘Mansion tax’ – Homes over £1.5 million could lose private residence relief, with sellers paying capital gains tax on the property’s growth. This would mainly affect London and the South East.
The property market in Hitchin
Hitchin’s property market is particularly sensitive to changes in stamp duty and wider tax reform, given the town’s mix of character homes and family properties often valued above the £500,000 threshold. For homeowners, a move towards an annual property tax could mean factoring in ongoing costs when planning their finances, rather than facing a one-off bill at the point of sale. For buyers, especially families relocating from London in search of more space, the removal of a large upfront stamp duty bill could make Hitchin even more attractive. However, as with any tax shift, there’s potential for asking prices to adjust in response. As a leading Estate Agent in Hitchin, we’re keeping a close watch on these developments to help both sellers and purchasers understand how the changes might affect their decisions in the local market.
Our view at Wellington Evans
We have long supported reforms that make moving more affordable and accessible. Stamp duty is a significant barrier – from first-time buyers to downsizers. Making the system fairer and less burdensome would benefit the entire market.
However, everything being discussed right now remains speculation. Proposals like these often circulate ahead of an Autumn Budget, and the final details can look very different – or may not happen at all.
For anyone moving now, the key point is: nothing has changed yet. It’s best to continue with your plans as they stand today.
At Wellington Evans, we’ll keep a close eye on developments and share updates as soon as anything is confirmed.
Curious about what your home might be worth in today’s market?
Get in touch with Wellington Evans, your trusted Estate Agent in Hitchin, for a free valuation and expert local advice – Click here to book your free valuation.
