Budget Update: Stamp Duty Land Tax
Good News For First Time Buyers?
Mike Bracegirdle considers the Chancellor’s announcement in this weeks Autumn budget for the immediate change to the Stamp Duty regime for genuine first time buyers.
What are the changes?
Stamp Duty has been abolished on property purchases by first time buyers on purchases up to £300k. The existing rate of 5% will continue to apply between £300k and £500k.
For an average first time buyer outside of London and the South East purchasing at £208k this is a £1,660 saving.
The government have estimated that these changes will benefit 80% of those seeking to purchase their first home
What is a ‘first time buyer’?
The definition of a first time buyer remains as per previous reliefs:
1. The buyer must never have owned a freehold or leasehold interest in a property anywhere in the world;
2. The purchase must be used as the only or main dwelling house; and
3. All purchasers have to be ‘first time buyers’ for the transaction to qualify.
Note, as a result of condition 2 above, parents could not claim the relief on the purchase of a property in their children names which is to be used as a buy to let property.
Will these changed make a real difference?
Some commentators have questioned whether these changes will simply have the effect of pushing up property prices in this price bracket, disadvantaging those seeking to move into a larger property or downsizing. And will the latest interest rises negate the practical financial saving? Only time will tell what the real effect of these changed will be.
Buying a property for the first time can be a daunting experience. Our residential property team have many years of experience and are accredited by the Law Society under the Conveyancing Scheme. For friendly, professional and practical help contact your local office. /our-services/conveyancing.aspx
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