The Chancellor’s Autumn Statement last December, which made radical reforms to the Stamp Duty system has helped boost the middle market and encourage prospective home buyers. Figures released by the National Association of Estate Agents (NAES) show that member agents recorded the highest level of registered home buyers per branch in December for 10 years. Agents reported that they saw a rise in the number of properties sold in the bands of up to £250,000 and £251,000 to £925,000. The last time the number of house buyers registered per NAEA member branch was this high for December was in December 2004. “The seasonally high figures suggest the changes made to Stamp Duty helped to encourage prospective buyers in a typically quieter month for the housing market,” says Helen Jones, Conveyancing Associate.
NAEA member agents reported positive movement in the middle market with almost 20% saying they saw an increase in sales of properties in the £251,000 to £925,000 band and 11% said there was an increase in in sales up to £250,000. There was a slight increase in percentage of sales made by first time buyers in December.
The changes made by the Chancellor, George Osborne, apply if you are buying a home in the UK for over £125,000. The changes do not affect commercial properties.
The old rates for Stamp Duty were: £125,001-£250,000 1%
£250,001-£500,000 3%
£500,001-£1m 4%
£1m-£2m 5%
£Above £2m 7%
Under the new rules Stamp Duty is charged at different rates depending on the portion of the purchase price that falls within that band, the rates are stepped as follows.
On the first £0-£125,000 0%
On the next £125,001-£250,000 2%
£250,001-£925,000 5%
£925,001-£1,500,000 10%
Above £1,500,001 12%
For example, if a buyer purchases a house for £275,000, under the new rules, the SDLT is calculated as follows:-
0% on the first £125,000 = £0
2% on the next £125,000 = £2,500
5% on the final £25,000 = £1,250 Total SDLT payable = £3,750
Previously they would have paid £8250.
For a link to the HMRC calculator Click Here.
HM Treasury estimates that Stamp Duty will be cut for 98% of people who pay it.
We have offices in Christchurch and the New Forest. Our Conveyancing team also cover Bournemouth and Poole. For a free initial chat, please call 01202 499255 and Helen or a member of the team will be happy to discuss any questions that you may have.
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