Wealthy foreign homebuyers face an extra stamp duty surcharge of around £95,000 this year, as a report reveals that the prime London market paid 12 per cent of all stamp duty paid in England in 2020.

Foreign buyers will see the 2 per cent surcharge introduced on 1 April in England and Northern Ireland, lifting stamp duty to £473,750 on an initial purchase and £593,750 on a second property, says a survey by high net worth broker Enness Global Mortgages. These figures are based on a £4m property, the average price of a prime home sold in England last year.

It added that London’s high-end homebuyers paid 12 per cent, or £368.6m, of the stamp duty paid in England last year, despite accounting for just 0.1 per cent of UK transactions.

The situation of these rich homebuyers contrasts with a large section of domestic buyers who are rushing to complete sales after chancellor Rishi Sunak extended the stamp duty holiday up to a threshold of £500,000 from the end of March to the end of June, the chancellor confirmed in last week’s Budget.

The chancellor added that the nil rate band for stamp duty would subsequently drop to £250,000 until the end of September, returning to the standard cut-off rate of £125,000 from 1 October.

However, London’s top tier buyers have saved £4.5m in stamp duty since the holiday last July.

But the report says: “Unfortunately, unlike the rest of the domestic market there is no stamp duty holiday extension for foreign buyers at the end of this month and to rub salt in the wound, there is also an additional two per cent being added for non-domestic buyers.”

Enness Global Mortgages co-founder and chief executive Islay Robinson adds: “While stamp duty is often considered a financial barrier to buying for the average homeowner, the sums paid via the prime market are far more substantial.

“However, stamp duty is just one piece of the puzzle when buying a property in the UK. Any discount negotiated, the potential to add value, finance costs and currency considerations all need to be weighed up to determine the true value of a transaction.

“Of course, those transacting at the very top-end are far better placed to stomach these costs and so a stamp duty saving hasn’t been a driving factor with regard to transacting, nor has it caused the mad panic to complete that we’ve seen across the regular market.

“The prime market is arguably better off as a result and we’ve seen a quality over quantity approach continue to improve market health across the top price thresholds, as confidence returns following a year of pandemic uncertainty.

“Of course, the introduction of a further two per cent stamp duty penalty for foreign buyers won’t do much to help this returning health, with high-end homebuyers from outside of the UK looking at an average cost of half a million pounds owed in stamp duty alone as of April.

“That said, a prime London home remains one of the must-haves on any notable international property portfolio and so this increase will be viewed as a small price to pay for the serious investor.”