First time buyers have as little as an eight per cent chance of finding a property which does not attract stamp duty reveals research from Alliance & Leicester Mortgages.

Last year just 99,234 properties in the whole of England and Wales sold for less than the £60,000 stamp duty threshold which leaves buyers exempt - a one in 13 (8%) chance of escaping the duty. In 1995, homebuyers had a 60-40 chance of avoiding the tax with 484,804 properties being sold for less than the £60,000 threshold.

The picture looks even bleaker when you consider that only six per cent of typical first time buyer properties i.e. flats/maisonettes, sold for under £60,000 last year. This compares to nearly three-quarters (72%) of flats/maisonettes being sold under the stamp duty threshold ten years ago.

And the number of houses available under £60,000 has decreased dramatically across all regions. This nationwide phenomenon has hit London the worst.

There has been a 99.7% drop in the number of houses available under £60,000 in the capital, with only 144 properties sold under £60,000 last year compared to 41,242 in 1995.

Stephen Leonard, Director of Mortgages, Savings & Investment Products at Alliance & Leicester, said: "Our research has found that the number of houses that are available to first time buyers under the £60,000 threshold today is severely limited."

"Stamp duty was never intended to be a prohibitive tax and with first time buyer activity at a 20 year low, this group of people could do with a helping hand. That is why we are calling on the Chancellor to scrap the tax for first time buyers completely."

"The Chancellor has a great opportunity to alleviate the strain on first time buyers by exempting them from stamp duty in this year's Budget – a move that would be welcomed by those struggling to achieve that first step on the property ladder."

If the stamp duty threshold remains unchanged, Alliance & Leicester Mortgages forecast that nine out of ten (90%) first time buyers will have to pay the tax by 2008 based on current trends, with this hitting 95% by 2011, making the first step onto the property ladder more and more difficult.

In fact, one in four (25%) first time buyers who bought a property in the last 12 months, found that the cost of stamp duty was a major obstacle to getting onto the property ladder according to recent research by Alliance & Leicester Mortgages.

With the average price of a first time buyer property now reaching £145,408, the percentage of first time buyers affected by stamp duty has trebled in the last seven years. Whereas in 1997 just over 27% of first time buyers paid stamp duty, 76% of first time buyers pay stamp duty now have to find the cost of this tax.