The Chancellor, Rishi Sunak, introduced the temporary Stamp Duty Land Tax (SDLT) in July 2020 to boost the housing market following the first national lockdown. The aim was to save buyers from paying stamp duty on any properties valued at up to £500,000 – a saving worth up to £15,000.
The desire for more outdoor space after being cooped up with lockdown alongside the stamp duty holiday has resulted in the housing market has been at its busiest for almost a decade!
New data from Rightmove shows that 1.3 million buyers have benefitted from the relief but in turn this has resulted in a £16,000 rise in the asking price of a home since July last year across the country and £8,400 in London.
So what happens next?
The nil rate band will return to the standard amount of £125,000.
Again you can use the Government’s SDLT calculator to work out the amount you will need to pay.
The rates from October 2021:
- Up to £125,000 – Zero
- The next £125,000 (the portion from £125,001 to £250,000) – 2%
- The next £675,000 (the portion from £250,001 to £925,000) – 5%
- The next £575,000 (the portion from £925,001 to £1.5 million) – 10%
- The remaining amount (the portion above £1.5 million) – 12%
For example if in October 2021 you buy a house for £295,000.
The stamp duty you owe will be calculated as follows:
- 0% on the first £125,000 = £0
- 2% on the next £125,000 = £2,500
- 5% on the final £45,000 = £2,250
- total SDLT = £4,750
For more information go to HMRC.
Future impact on the property market
It is possible that the market may soften and possibly even undergo some price correction as the relief window closes. In that case buyers may then seek to re-negotiate prices with their sellers.
The potential benefits?
From October 1 only first-time buyers will get stamp duty relief on property worth less than £300,000, so there will be less competition from buy-to-let investors or those buying city for the future.
You can use Government’s SDLT calculator to work out what you will need to be pay.
How can we help?
To help keep the market buoyant, we are offering a 10% discount for all Homebuyers Level 2 and Level 3 Survey booked and paid for in full within the month of October 2021. All you need to do is quote "SDLT21" at the time of the booking to claim your discount.
Please note that this offer cannot be used in conjunction with any other offers.