Homebuyers paid almost £1bn in stamp duty in February as lower tax thresholds and rising house prices continue to push up the cost of moving.
Analysis of the latest HMRC figures by Coventry Building Society shows buyers paid £995m in Stamp Duty Land Tax during the month, up from £899m in January – an increase of 11% in just four weeks.
The lender said the higher bill reflects the continued impact of last April’s cut to the nil-rate threshold, which was reduced from £250,000 to £125,000, bringing far more transactions into the tax net.
Over the course of last year, homebuyers paid £15.4bn in stamp duty compared with £13bn in 2024, an increase of 18% as more purchases became liable for the charge.
BILLIONS IN TAX
Since the threshold change took effect, Coventry estimates buyers have paid around £14bn in the tax, highlighting how the revised bands are increasing the cost of buying even where house price growth has been modest.
The mutual also pointed to the growing mismatch between stamp duty thresholds and property values.
The £125,000 starting point for the tax was introduced in December 2014, when the average UK property price stood at £176,561.
According to the latest UK House Price Index data for December 2025, the average price has now risen to £270,259 – an increase of more than £93,000 – meaning many homes that once fell below the tax band now attract a charge.
Coventry said the figures underline how transaction costs have risen sharply over time, with more buyers now paying stamp duty even when purchasing properties close to the national average price.
KEEPING PACE
Jonathan Stinton, Head of Intermediary Relationships at Coventry Building Society, says: “For many buyers, stamp duty has become the hidden cost of moving home.
“Just when people think they’ve saved enough for a deposit, they realise they’re facing a tax bill which could run into thousands.
“The problem is the system hasn’t kept pace with house prices. The £125,000 threshold might have seemed appropriate a decade ago, but the average house price has climbed nearly £100k since then – meaning more people are pulled into a higher tax band by default rather than design.
“And with the Bank of England now expected to hold the base rate rather than cut it this year, borrowing costs are likely to stay higher for longer. This only adds to the pressure on buyers already juggling mortgage rates and upfront moving costs.”
MEANINGFUL SUPPORT
And he adds: “Reforming stamp duty would give buyers meaningful support at a time when many are already stretched.
“Updating the thresholds would prevent buyers from being pushed into higher tax bands and allow more of their budget to go toward deposits and essential moving costs.
“It’s a practical change that would make taking the next step on the property ladder more achievable when pressures across the market continue to build.”
