Prime Minister Andy Burnham faces mounting pressure to overhaul stamp duty for homeowners aged 65 and over, following a powerful new report from the Radix Big Tent housing commission. The think tank argues that extending first-time buyer style relief to older people could unlock nearly 900,000 family homes and help rebalance the generational housing divide.
Radical Proposal to Boost Market Fluidity
The commission's report, chaired by Alex Notay, calls for pensioners to receive the same stamp duty exemptions currently reserved for first-time buyers. In England and Northern Ireland, no stamp duty is payable on the first £125,000 of a main residential property, while first-time buyers benefit from a £300,000 threshold on properties up to £500,000. Scotland operates a similar system with differing rates.
According to the commission, extending this relief to over-65s could bring an estimated 870,000 larger family homes back onto the property market, as older owners are incentivised to downsize. "Stamp duty is stopping older people from downsizing," the report warns, calling the current system a barrier to efficient housing allocation.
Generational Housing Divide Deepens
Alex Notay, chairman of the housing commission, said the UK faced "a stark and growing generational housing divide." He emphasised that the policy change would particularly benefit younger families struggling to find suitable homes. Ben Rich, chief executive of Radix Big Tent, added: "We have to be more radical if we are really going to get the housing market moving again, which means incentivising older people to find homes better suited to their needs."
The proposal comes as part of a broader push to address housing affordability and supply. Currently, stamp duty rates vary by region: in England and Northern Ireland, the standard threshold is £125,000; Scotland and Wales set their own thresholds. First-time buyers in England and Northern Ireland pay no duty on the first £300,000 of a property costing £500,000 or less; above that, the standard thresholds apply.
Treasury Response and Next Steps
A Treasury spokesman declined to comment directly on the proposal, stating: "As has always been the case, decisions on tax are a matter for the Chancellor to set out at fiscal events, rather than routinely commenting on rumour, speculation or proposals." The statement leaves the door open for potential inclusion in a future Budget or fiscal event.
The Radix Big Tent commission argues that the policy would be cost-effective, as the revenue lost from stamp duty relief would be offset by increased transactions and economic activity. They estimate that unlocking 870,000 homes could significantly ease pressure on the housing market, particularly in areas with high demand.
Political and Public Reaction
The proposal has already sparked debate among housing campaigners and political commentators. Some argue that targeting relief solely at over-65s could create distortions, while others welcome the focus on freeing up under-occupied family homes. Prime Minister Burnham has not yet publicly responded to the report, but sources close to Number 10 suggest the government is reviewing a range of housing market interventions.
If implemented, the change would mark a significant shift in housing policy, potentially benefiting hundreds of thousands of older homeowners and thousands of families seeking larger properties. The commission hopes the proposal will be taken up as part of a wider package of reforms to address the housing crisis.
