A Stamp Duty holiday!
No doubt you've heard, the Government has raised the threshold for paying stamp duty on your property purchase, they're calling it a 'stamp duty holiday' and it will be run until 31st March 2021. The move is aimed at helping buyers who have taken a financial hit because of the coronavirus crisis. It is also intended to boost a property market hit by the lockdown.
Previously, you would have paid stamp duty on homes sold for at least £125,000, or if you were a first-time buyer, on properties sold for more than £300,000. The chancellor has suggested the average stamp duty bill will fall by £4,500, with nearly nine out of 10 people buying a main home this year paying no stamp duty at all.
Here are some stats courtesy of Rightmove that help put the chancellor’s comments into context -
There are over 510,000 properties that are under £500,000 on Rightmove in total, making up 81% of all properties for sale in England
Over 291,000 properties under £500,000 are currently available for sale on Rightmove, making up 78% of all properties available for sale in England – this means they have not yet found a buyer
People enquiring about properties under £500,000 on Rightmove makes up 84% of all buyer enquiries we get in England
For the official line on the government’s announcement, click here, but what are the specifics of the stamp duty holiday? Our Stamp Duty Land Tax calculator is now being worked on, we'll make it nice and easy to work out the exact Stamp Duty you'll pay on your purchase soon. But you can use the information below to work out the stamp duty due in the meantime.
If you buy a home between now and 31st March 2021, you only start to pay stamp duty on the amount that you pay for the property above £500,000.
For a property, lease premium or transfer value up to £500,000 you will pay 0% stamp duty
The next £425,000 (the portion from £500,001 to £925,000) you'll pay 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
And the remaining amount (the portion above £1.5 million) will pay 12%
What do other experts say? well in this instance we can only agree -
Rightmove’s property expert Miles Shipside said: “This move will help to keep the nation and wider economy moving because keeping the current momentum going will help prevent destabilising falls in property prices as unemployment grows, and enable a quicker economic recovery.
“Lockdown prevented 175,000 would-be sellers from coming to market so we hope this Stamp Duty holiday will provide the spur for those missing movers to come to market. They will find there’s currently record demand for their properties from prospective buyers, with Rightmove enquiries to agents now double what they were before lockdown.
“Home-movers will be grateful that the changes come into effect straight away so they don’t have to delay their plans, and what we could see now is people rushing to get a price agreed before some sellers put their prices up in the hope people will be able to pay more because of the tax savings.”
If you think the stamp duty holiday gives you the extra help to move home now get in touch, let us know how we can help.
Thu 09 Jul 2020