First-Time Buyer Relief, in Months of Mortgage Interest (2026)
First-time buyer relief on English stamp duty is worth a flat £5,000 to anyone buying between £300,000 and £500,000 — the same cash saving whether the price is £310,000 or £490,000. But converted into something a buyer actually feels each month — mortgage interest — that fixed £5,000 buys a shrinking amount of cover as the price climbs. At the bottom of the band it is worth just over six months of interest on a typical loan. By the time the band closes at £500,000, the same £5,000 covers well under four.
The relief in months of interest
| Purchase price | First-time buyer relief | 75% LTV loan size | Monthly interest at 4.32%* | Relief, in months of interest |
|---|---|---|---|---|
| £300,000 | £5,000 | £225,000 | £810 | 6.2 |
| £350,000 | £5,000 | £262,500 | £945 | 5.3 |
| £400,000 | £5,000 | £300,000 | £1,080 | 4.6 |
| £450,000 | £5,000 | £337,500 | £1,215 | 4.1 |
| £500,000 | £5,000 | £375,000 | £1,350 | 3.7 |
| £500,001 | £0 | £375,001 | £1,350 | 0.0 |
*Assumes a 75% loan-to-value mortgage at the Bank of England's quoted 5-year fixed rate of 4.32% (April 2026 print, the most recent published at the time of writing), treated as interest-only for comparison purposes. Stamp duty figures verified against Homecost's stamp duty calculator (POST /api/sdlt/calculate) on 12 September 2026: a first-time buyer pays £0 at £300,000, £5,000 at £400,000 and £10,000 at £500,000, against a £15,000 bill the moment relief disappears at £500,001.
Why the relief buys less as the price rises
The cash saving itself never moves. As Homecost has previously set out, first-time buyer relief works by charging 0% on the first £300,000 of a purchase and then the standard 5% on the slice between £300,000 and £500,000. Because a home mover's bill on that same first £300,000 tops out at £5,000, that is the most the relief can ever be worth — and it holds flat across the whole band before disappearing entirely above £500,000, as Homecost's comparison of the relief cap and the additional-property surcharge explains in full.
What changes is the loan the relief is being measured against. A 75% loan-to-value mortgage grows in a straight line with the purchase price, so the monthly interest bill grows with it — £810 a month at £300,000, £1,350 a month at £500,000. Dividing a fixed £5,000 by a growing monthly interest figure produces a steadily shrinking number of months, from 6.2 down to 3.7 across the band, before dropping to zero the moment the price passes £500,000 and the relief is withdrawn.
This is the mirror image of a pattern Homecost found in the Scotland-versus-England-and-Wales stamp duty refund gap, where the same months-of-interest conversion holds constant at roughly 11.1 months at every price point from £300,000 to £1 million. That gap doesn't move because both the cash difference and the loan size are fixed percentages of price, so price cancels out of the sum. First-time buyer relief is built differently — a flat cash value divided by a proportional loan — so instead of holding steady, the ratio erodes as price rises.
How many buyers sit in this band
The £300,000–£500,000 taper is not a small slice of the market. Of 758,160 single-residential sales recorded in England during 2025 (HM Land Registry Price Paid Data, category A, checked 12 September 2026):
| Price band | Share of 2025 English sales |
|---|---|
| £300,000 or less (FTB nil-rate) | 50.2% |
| £300,001–£500,000 (taper band, relief worth a shrinking number of months) | 30.8% |
| Above £500,000 (relief withdrawn) | 19.0% |
Just under a third of sales fell inside the band where this erosion actually plays out. For a buyer near the bottom of it, the relief covers a meaningfully bigger chunk of a year's interest than it does for a buyer near the top — even though HMRC treats both as receiving exactly the same £5,000.
What this doesn't tell you
This is a comparison of tax mechanics and mortgage arithmetic, not a reason to buy at one price over another, and not a claim about the mortgage rate any individual buyer will secure — actual rates depend on the lender, deposit and credit profile, and will differ from the Bank of England's quoted average used here. It also treats the mortgage as interest-only for the purpose of the comparison; a capital-repayment mortgage would show a smaller effective monthly interest cost, which would stretch the months-of-relief figures higher without changing the shrinking pattern across the band.
Try the calculation at a real purchase price on Homecost's stamp duty calculator, or see the wider cost picture — mortgage, council tax and stamp duty together — for a property in the taper band by looking up a postcode such as Leeds' LS1 4DY on the true-cost tool. More pieces like this are collected under Homecost's cost intelligence guides.
This is general information about how stamp duty and mortgage costs are structured, not advice on whether or when to buy. Speak to a qualified adviser before acting.