Chancellor Rishi Sunak’s long-awaited announcement on the next stage in the Government’s aim to secure economic recovery brought some fantastic for the UK’s property industry.
There had been rumours circulating in the media that big changes were in the pipeline regarding Stamp Duty Land Tax (SDLT) – and Mr Sunak’s update certainly didn’t disappoint in that respect.
The Government’s £30bn plan is specifically designed to prevent mass unemployment and restart an economy which has been hit hard by the coronavirus outbreak.
Alongside a job retention bonus for bringing staff out of furlough, and VAT cuts for the hospitality sector, Mr Sunak also announced a temporary and immediate holiday on Stamp Duty on the first £500,000 of all property sales in England and Northern Ireland up to and including March 31st, 2021.
What are the benefits of the Stamp Duty holiday?
The Chancellor’s announcement means that now is the perfect time to buy property – whether you’re thinking of selling up to move to a new home, or you’re thinking about investing in somewhere to let.
Indeed, it has been reported that the average SDLT bill will fall by £4,500, with around nine out of 10 main-home buyers paying no SDLT at all.
Meanwhile, it’s been reported that those buying a property of half-a million or more could save as much as £15,000.
There is still Stamp Duty to pay if you are buying an additional property to your main home, but this has greatly reduced, meaning anyone thinking of becoming a landlord will pay considerably less when buying a property under the threshold to rent out.
What we think of the new Stamp Duty holiday
James Clarke, our Land & New Homes Director, says: “Any assistance that can be given to property buyers is always welcome, as incentives like this give the opportunity for buyers to realise their dream and buy their new property.
“It has been a buoyant time in the market since lockdown restrictions have been lifted, and we have seen increased sales on a month-on-month comparison with June 2019.
“Personally, I feel this is a result of pent-up demand, with buyers re-evaluating their lifestyles and an increasing number of employers offering home-working.
“The Chancellor’s announcement should assist in keeping an active marketplace. Confidence is a huge element in an effective marketplace, and we have already seen a spike in enquires coming into our network of offices.
“From talking to our current buyers on Wednesday night, they are delighted with the news as they now have extra money to keep in savings or treat themselves to something nice for their new home.”
How the new Stamp Duty holiday will benefit the lettings market
Richard Rabin, our Lettings Director, says: “The new announcement means now is a great time to buy for those looking to use property as an investment.
“Although people buying additional properties will still have to pay Stamp Duty, the new 3% rate on the first £500,000 is lower than it was previously.
“The lettings market is the most buoyant I have ever seen it, with huge demand from tenants – and I don’t see this changing for quite some time.”