🏡 Stamp Duty Alert for Ruislip & Pinner Buyers! 🏡
There was some important small print in this year’s budget that has largely gone unnoticed. The 2% hike in stamp duty rates for people purchasing a second property was in most of the headlines but what was not was the temporary stamp duty cuts not being extended beyond March 31st next year. Watch the video to see my full breakdown of the impacts.
There was some important small print in this year’s budget that has largely gone unnoticed and unreported.
The 2% hike in stamp duty rates for people purchasing a second property was in most of the headlines but what was not was the temporary stamp duty cuts from the Liz Truss budget of 2022 not being extended beyond March 31st next year.
So, what does this mean in terms of numbers?
For home movers in Ruislip, Pinner, and surrounding areas already on the ladder it will effectively mean you will pay an extra £2500 if your purchase is completed on April 1st and beyond.
But it is first time buyers (ftb) that will be hit hardest.
Firstly, the threshold where no stamp duty is paid will be reduced from the current £425,000 to £300,000
So, this would mean if you were buying a property today at £425,000 you would pay zero stamp duty, on April 1st 2025, for this same purchase you would pay £6250 in stamp duty which is 5% of the amount above the £300,000 that will be Stamp duty exempt.
Now this is where it gets a little more tricky
The threshold limit where first buyers lose their tax break completely will reduce from £625,000 to £500,000.
This would mean any purchase over £500,000 for a ftb will be subject to the standard stamp duty rates.
So, if a ftb was to buy a property at £625,000 today it would be subject to £10,000 stamp duty, this jumps to £21,250 from April an increase of £11,250
If the purchase price is on the upcoming threshold at £500,000 you would be paying £3750 today but £10,000 from April next year, an increase of £6250
So, what impact might this have on the market?
It will certainly mean sales agreed over the next few months will have some real urgency on completing before the end of March and massive pressure on agents and solicitors to ensure it happens in time.
The cost to home movers of £2500 should not change their plans greatly but it is the impact on first-time buyers that will dictate the effect this has on the market and first time buyers are the first link in the chain for a buoyant market. These tax cuts were always a temporary measure, but this will be a bit of a shock to some planning to buy for next year. But those motivated to purchase their first home will still look to buy I am sure, however they will have to shift their affordability to suit
If you are looking to move next year and want to start preparing now, I would love to have a chat with you and help you with your plans, so please get in touch using the details below
James 07513 13702
james@avocadopropertyagents
