How will the autumn budget’s changes in stamp duty affect us? Fidler Taylor’s new director for valuation and commercial property Mark Renshaw, a chartered surveyor of over 15 years in Chesterfield and Sheffield, gives his view.
Most homeowners only ever sell their home when they want to buy another and won’t be affected by stamp duty changes. However, if you are lucky enough to be able to buy a second home then you will feel the pinch. And if you choose to invest in bricks and mortar to increase your wealth, you will feel it too.
The new higher rates of Stamp Duty Land Tax (SDLT) will apply to anyone buying additional residential properties costing more than £40,000 from April 1.
These new rates will be 3 per cent higher. Houses selling at up to £125,000 have been exempt of stamp duty, but from April 1, buyers who already own a property will have to pay a 3 per cent fee on purchases from £40,000 to £125,000.
For properties between £125,001 and £250,000 the rate for such buyers increases from the current 2 per cent to 5 per cent. And the same type of buyers purchasing properties between £250,001 and £925,000 will pay an 8 per cent charge instead of the current 5 per cent.
“Why should we suffer?” cry investors. The government says it’s because homeowners – and those not yet on the property ladder – are being squeezed out by buy-to-let landlords expanding their portfolios and the wealthy wanting extra homes.
Some £60m of the money raised will go to communities in England where the impact of second homes is acute - beautiful locations where young local people can’t buy.
I believe the rise in stamp duty will hit the very people it is supposed to help. It will discourage small landlords and a shortage will mean first-time buyers will be stuck for longer in rented accommodation while they struggle to save up a deposit.