It is not as if you have had to read too many articles to find interesting stories about the UK Government these days. These are turbulent times in the political landscape, and it would be wrong to state what is going to happen with any great certainty. However, it is important to consider what may happen in certain scenarios, and many people have questioned would seller stamp duty impact the property market?
It is not as changing stamp duty is at the top of the list of priorities for the UK Government right now. However, Chancellor Sajid Javid outlined plans that he believes will help buyers step on to the property ladder. The plan is a simple one, make vendors pay for the stamp duty on a property deal, not the buyer.
Stamp duty brings in a lot of money for the UK Government
Currently, the Government receives £11.9 billion in stamp duty annually. The average property price in the country is £230,000 and this would see a stamp duty bill of £2,100 for the property. Of course, it is difficult to discuss stamp duty without mentioning the caveats that are in place.
Right now, while the buyer pays the stamp duty, not every buyer pays the duty, or the same rate. If you are a first-time buyer purchasing a property that is worth less than £300,000; you don’t need to pay stamp duty on the purchase.
There is no denying many industry sources have said stamp duty has played a role in stifling the market. A home buyer purchasing a house which costs £350,000 could find themselves having to find an additional £7,500 in stamp duty costs.
Buying a home is expensive, and having to find a sum like this, with a time constraint, is challenging. Removing this burden from buyers would help some households balance their budget to buy property.
Right now, and again, the Government may have more pressing matters to attend to, the Chancellor is said to be reviewing a number of systems. The Chancellor has spoken out about his desire to help more first-time buyers step on to the property ladder. Sajid Javid has also said; “If you are going to have tax cuts, I think you should always be thinking about the lowest paid. I’m looking at various options. I’m a low-tax guy. I want to see simpler taxes.”
Buyers and vendors will have different emotions regarding proposed changes
This change, if it does occur, will be welcomed by buyers, but vendors are unlikely to be thrilled. Selling your home is often expensive, and this change may seem some homeowners deciding against selling their home. If this leads to a further drop in supply of homes, there could be a sizable slowdown in the economy.
For now, people can only surmise what is likely to happen. However, if you want to remain informed of what is happening in the UK property market, it is best to rely on a local specialist.
At Bond Oxborough Phillips, we are here to help you with your next move. If you plan on selling your home, we offer a valuation service, so get in touch to arrange that. No matter what you intend to do next, we are here to assist you.