It is likely that you will have heard the announcement made by Chancellor Rishi Sunak on the 8th July 2020 regarding his ‘mini-budget’. Of course, as estate agents, for us, one of the biggest things to have come out of the budget is the changes to stamp duty regulations.
It goes without saying that these changes will make a huge difference to both people interested in buying a new property and also those who are trying to sell too. So, it really is brilliant news for the property industry as a whole.
If you heard about this announcement but you’re not too sure what has changed in relation to stamp duty, our team here at Tatewood have put together an easy to understand guide covering all of the basics. Below is everything you need to know about stamp duty and the changes that have been made from the 8th July 2020.
Stamp duty is a tax that you may have to pay when purchasing a property or a piece of land in England and Northern Ireland. This is also commonly referred to as SDLT (Stamp Duty Land Tax) and it is only payable on property or land that is over a certain price. Before 8th July 2020, the threshold for SDLT was £125,000 for residential properties, £150,000 for non-residential properties and land and £300,000 for first-time buyers.
The amount of SDLT that you pay will vary depending on the type of property you purchase and also the price of this property too. Simply put, you will essentially pay a percentage of the property price, but this percentage goes up as the price of the property does, you can find out more about this on the Government website. An estate agent will also be able to advise you on how much stamp duty you would need to pay on a property that you’re interested in.
On 8th July 2020, the Government announced that they have temporarily increased the stamp duty threshold for properties in England and Northern Ireland. From the 8th July 2020 until the 31st March 2021, the SDLT threshold will now be £500,000. So, a huge percentage of people who are purchasing a property will pay no SDLT when doing so in the next few months.
Whilst the stamp duty bands haven’t changed for properties that cost more than £500,000, people purchasing over this price will still make a saving of up to £15,000 thanks to these new changes. First-time buyers should note that this ‘stamp duty holiday’ also replaces their normal discount, so they too can benefit from this increased threshold.
Whilst the benefits of these changes may seem fairly obvious for potential buyers as they will be saving thousands of pounds, there are also numerous benefits for those who are selling their property too. Firstly, it is likely that because of this change, there will be lots more interest in the property market and many will be looking to purchase ASAP so they can take advantage of this tax break.
Not only can sellers expect to have more interest in their property that is up for sale, but they may also find that people aren’t offering below the asking price or negotiating as much. Due to the fact that purchasers will be paying much less SDLT, they may be able to spend more on the property itself and therefore increase their budget, which is undeniably beneficial for sellers. All in all, it is a brilliant time to buy or sell a property.
Hopefully, you will now understand a little bit more about the Chancellor’s announcement in relation to stamp duty and why this is such an incredibly exciting time for the property industry, as well as anyone wanting to buy or sell a property. So, if you have been thinking about putting your property on the market, now is a brilliant time to contact our estate agents in Enfield and London who will be able to assist you with this.
On our website, we also have a stamp duty calculator which will allow you to work out how much you will need to pay in taxes, if anything at all, along with the money you will be saving. This also reflects the new regulations following on from the chancellor’s statement on 8 July. It is important to note that transactions involving additional property, including second homes and buy to let investments, will continue to attract a 3% surcharge.
Selling a property in Enfield, and the surrounding areas, has never been easier than with the full service we provide here at Tatewood. Our incredibly experienced team can handle everything needed to sell your property online, so you can relax knowing that you’re in the best hands when you choose us to be your estate agent. Please don’t hesitate to contact us if you have any questions at all, we will gladly answer these for you. We look forward to helping you sell your property.